An assumption in the model of the money supply process is that the desired levels of currency and excess reserves
A) are given as constants.
B) grow proportionally with checkable deposits.
C) grow proportionally with high-powered money.
D) grow proportionally over time.
B
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If the price elasticity of demand for gasoline equals 0.3, then an increase in the price of a gallon of gasoline from $3.70 to $3.90
A) decreases total revenue. B) increases total revenue. C) leads to no change in total revenue. D) makes the demand for gasoline elastic. E) Both answers B and D are correct.
Figure 11-3
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In Figure 11-3, which line represents the change in the consumption schedule caused by a cut in fixed taxes?
A. C1 in graph (a) B. C2 in graph (a) C. C1 in graph (b) D. C2 in graph (b)
Refer to the graph shown. The line segment that represents average variable costs of producing Q* is:
A. CQ*. B. AB. C. AQ*. D. BQ*.
The long-run equilibrium for a monopolistically competitive firm is efficient because its profits equal zero in the long run.
Answer the following statement true (T) or false (F)