A simple deposit multiplier equal to one implies a required reserve ratio equal to
A) 100 percent.
B) 50 percent.
C) 25 percent.
D) 0 percent.
A
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Comparative advantage is directly related to which of the following concepts?
A) productivity B) efficiency C) opportunity cost D) competition E) fairness
Refer to Figure 21-6. The loanable funds market is in equilibrium, as shown in the figure above
An increase in the supply of loanable funds could result in which of the following combinations of the real interest rate and quantity of loanable funds at a new equilibrium? A) The real interest rate is 3 percent, and the quantity of loanable funds is $90 million. B) The real interest rate is 3 percent, and the quantity of loanable funds is $150 million. C) The real interest rate is 5 percent, and the quantity of loanable funds is $90 million. D) The real interest rate is 5 percent, and the quantity of loanable funds is $150 million.
During recent elections, consumer groups in various states attempted to get the sales tax on all medicines and drugs removed. They argued that such a tax is "severely regressive." What is the economic interpretation of their statement?
a. The poor get ill more often than do the rich. b. The poor pay higher prices for medicine and drugs than do the rich. c. The poor pay a higher percentage of their income for medicine and drugs than do the rich. d. All consumers pay too much money for medicine and drugs. e. The sales tax discourages the poor from seeking medical treatment.
When a good is nonexcludable, then individuals
A) will purchase the good for more than what it cost to produce the good. B) can obtain the benefits of the good without paying for it. C) have an incentive to become free riders. D) will purchase more than the optimum amount. E) b and c