The banking system creates money in the sense that it:
a. prints money
b. creates excess reserves from loans.
c. creates loans from excess reserves.
d. creates required reserves from loans.
e. creates loans from required reserves.
c
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Using the SSNIP test, if two firms merge and the result is that the new, merged firm can raise the price of its product by ________ percent for ________ year(s), then the product the merged firm produces represents a market.
A) one; five B) five; five C) five; one D) one; one
Laura Kaid owns a business and is willing to invest in capital until, at the margin, her investment yields a cash stream with a present value less than the marginal cost of the investment
a. True b. False
A monopolist faces a downward-sloping demand curve because:
A. the demand for its product is inelastic. B. the industry demand curve is horizontal. C. resource prices increase as the monopolist expands output. D. the entire market demand curve is the monopolist's demand curve.
Price discrimination works best when
A. Buyers have information about prices charged to different customers. B. Sellers cannot meet collectively. C. A product is purchased frequently by consumers. D. Buyers do not have perfect information about the price.