An individual deciding how to allocate her limited time is dealing with both scarcity and trade-offs
a. True
b. False
Indicate whether the statement is true or false
True
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The greater the marginal propensity to consume in the economy, the smaller the spending multiplier
a. True b. False Indicate whether the statement is true or false
Railroads have received significant attention from regulators because
a. railroads enjoy significant economies of scale. b. conditions in the railroad industry are conducive to destructive competition. c. regulators would like to ensure universal service to all potential railroad customers. d. All of the above are correct.
A bank has an 8 percent reserve requirement, $10,000 in deposits, and has loaned out all it can given the reserve requirement
a. It has $80 in reserves and $9,920 in loans. b. It has $800 in reserves and $9,200 in loans. c. It has $1,250 in reserves and $8,750 in loans. d. None of the above is correct.
If the price of an underlying asset has a standard deviation of zero:
A. options for this asset would likely not exist. B. options for this asset would have a time value of the option equal to the price of the asset. C. option for this asset would be highly valued. D. the intrinsic value of options for this asset would equal the asset's price.