If demand increases while supply simultaneously decreases, then the equilibrium quantity
A. can never change.
B. always increases.
C. always decreases.
D. None of these
Answer: D
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If Atlantis has an open economy, then it:
A. does not trade with other countries B. has a democratically elected government C. trades with other countries D. allows imports but not exports.
According to the Taylor rule, if inflation equals 3 percent and there is an expansionary gap equal to 3 percent of potential output, the Fed will set a real interest rate of ________ percent and a nominal interest rate of ________ percent.
A. 4; 6 B. 1; 3 C. 1; 4 D. 4; 7
The figure above shows the market for coffee If the government pays the coffee producers a subsidy and production increases to 30 million pounds per day, the deadweight loss is
A) zero. B) $7.5 million. C) $15 million. D) $10 million.
If we focus on the banking system and assume no change in the public's currency holdings, a loss of reserves by any one bank must:
A. result in a multiple loss to the banking system. B. equal the loss of reserves by the entire system. C. be equal to the net loss of reserves for the banking system. D. result in no change in reserves for the banking system.