The Monetary Control Act of 1980:
a. extended the Fed's authority to impose required-reserve ratios on all depository institutions.
b. excluded the required-reserve ratios as an instrument of short-term policy.
c. provided the Fed with the authority to use open market operations.
d. all of the above.
e. none of the above.
a
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A cloth manufacturing firm is deciding whether or not to invest in new machinery. The machinery costs $45,000 and is expected to increase cash flows in the first year by $25,000 and in the second year by $30,000 . The firm's current fixed costs are $9,000 and current marginal costs are $15 . The firm currently charges $18 per unit. If the interest rate is 5% then the present value of the cash flows is
a. $6,020.41 b. $51,020.41 c. -$7,380.95 d. $10,000
If an initial increase in investment spending of $30 caused equilibrium output to increase by $120, what is the value of the MPC?
a. 0.25 b. 0.50 c. 0.60 d. 0.75 e. 0.80
Frank owns Frank's Shoes. During a particular period, the price of shoes rises and Frank produces more shoes by hiring more workers and using more material, such as leather. However, he still works with the same size factory because he has a long-term lease. You know that
a. by producing more, Frank's supply curve of shoes shifts to the right b. the factory is overworked so that Frank cannot maintain the production levelhe selected c. by producing more, Frank's demand curve for shoes shifts to the left d. Frank is producing in the short run e. Frank is producing in the long run
Which of the following is a property of dummy variable regression?
A. This method is best suited for panel data sets with many cross-sectional observations. B. The R-squared obtained from this method is lower than that obtained from regression on time-demeaned data. C. The degrees of freedom cannot be computed directly with this method. D. The major statistics obtained from this method are identical to that obtained from regression on time-demeaned data.