Which theory explains the fact that some firms may choose to pay their employees more then they would earn as determined by equilibrium in the labor market?
a. the theory of efficiency wages
b. the marginal-productivity theory
c. human-capital theory
d. signaling theory
a
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The monetary base is defined as
A) bank reserves plus currency held by the nonbank public. B) bank reserves minus vault cash. C) all deposits at the Fed. D) deposits at the Fed plus vault cash.
In the Activists' Paradise, to increase real GDP without affecting the interest rate, it is necessary to change
A) only fiscal policy and shift the IS curve. B) only monetary policy and shift the LM curve. C) fiscal and monetary policies and shift both IS and LM. D) more policy instruments than policymakers are actually able to manipulate.
Food and drug labeling is a low-cost way to inform consumers about the contents of foods and the dangers of drugs
Indicate whether the statement is true or false
Money center banks differ from community banks in all of the following ways except:
A. they obtain their funds primarily through borrowing and not by deposits. B. they are actively engaged in the money market. C. they are usually much smaller. D. they are a much smaller percentage of the total number of banks.