Refer to Figure 18.7 below. The intercept point N is actually found by I 1 + I 0 (1 + r). The intercept point M is calculated by I 0 + I 1 /(1 + r). Show that the slope of the budget constraint is indeed 1-r| .
At 35 hours worked, total consumption is $10 * (35) = $350. At a wage of $8.50 and 35 hours,
total consumption becomes 8.50 * (40) = $340.
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Refer to Table 9-12. Prior to trade, what was the opportunity cost to produce 1 belt in Morocco?
A) 1/2 of a sword B) 1 sword C) 1.5 swords D) 2 swords
If firms follow a low-price guarantee strategy, the price that will prevail in the market will be closest to:
A. the price a monopolist will pick. B. the price that a perfectly competitive firm would pick. C. the duopoly price. D. the price that would yield zero economic profits.
In the taste-for-discrimination model:
A. discriminatory employers behave as if employing nonpreferred-race workers adds to costs. B. individual workers are judged by the characteristics of the groups to which they belong. C. prejudiced white employers will never hire African-American workers. D. women and minorities are confined to a limited number of occupations.
Which of the following will happen when the Federal Reserve buys bonds from the public in the open market and the amount of cash held by the public does not change?
A. The required reserve ratio will increase. B. The money supply will decrease. C. The deposits of commercial banks will decline. D. Commercial bank reserves will increase.