Suppose the CPI in 1990 is 500, with 1967 as the base year. On average, how much money must be spent in 1990 to purchase the same quantity of goods and services that could have been bought with $10 in 1967?
A. $50
B. $5
C. $400
D. $500
A. $50
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If the Fed buys a $100,000 government security from a bank when the desired reserve ratio is 10 percent and the currency drain ratio is 50 percent, the bank can loan a maximum of
A) $90,000. B) $100,000. C) $60,000. D) $40,000. E) $50,000.
Which of the following describes a difference between the marginal product of labor and the marginal revenue product of labor?
A) The marginal product of labor declines as each additional worker is hired because of the law of diminishing returns. The marginal revenue product of labor declines as each additional worker is hired because of diseconomies of scale. B) The marginal product of labor is inelastic. The marginal revenue product of labor is elastic. C) The marginal product of labor declines as each additional worker is hired because of the law of diminishing returns. The marginal revenue product increases as each additional worker is hired because of increases in the productivity of labor. D) The marginal product of labor measures the change in output as additional workers are hired. The marginal revenue product measures the change in revenue as additional workers are hired.
A law establishing a minimum legal price for a good or service (the minimum wage for example) is known as
a. an equilibrium price. b. a price floor. c. a price ceiling. d. a price wall.
When the marginal product of an input is ______ than the average product, the marginal units of the input _____ the average product.
A. larger; lower B. smaller; raise C. smaller; do not affect D. larger; raise