If the Fed thought the economy was experiencing a recessionary gap, and it wanted to correct this gap, it would
A. raise the reserve requirement.
B. sell bonds.
C. lower the differential between the discount rate and the federal funds rate.
D. increase aggregate supply.
Answer: C
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This year Iceland has a real GDP per person that is approximately 8 times greater than that of Cape Verde. Cape Verde's growth rate of real GDP per person was 5.2 percent
If Cape Verde maintains this current growth rate, approximately how many years will it take for Cape Verde's real GDP per person to reach the same level that Iceland has this year? A) 13.5 years B) 20 years C) 27 years D) 40 years E) 54 years
In an English auction, the winner pays a price equal to ________
A) the value of the highest bid B) the value of the lowest bid C) his value for the good D) the value of the second-highest bid
Refer to the figure above. After the demand curve shifts to D2, if the price is held below the new equilibrium, then:
A) the quantity demanded will equal the quantity supplied. B) the quantity demanded will be greater than the quantity supplied. C) the quantity demanded will be less than the quantity supplied. D) there will be zero deadweight loss.
Katie finds that the marginal utility from a compact disc is 30 and the marginal utility from a pizza is 10. The price of a compact disc is $15 and the price of a pizza is $10. In order to increase her utility, Katie should
A) consume more compact discs and fewer pizzas. B) consume fewer compact discs and more pizzas. C) not change her consumption of pizza and compact discs. D) consume fewer compact discs and fewer pizzas.