Assume that the reserve ratio is 20% and banks in the system are loaning out all their excess reserve. If people collectively cash out $10 billion from their checking accounts, then the lending ability of the banking system will be
A. increased by $10 billion.
B. decreased by $40 billion.
C. decreased by $50 billion.
D. decreased by $10 billion.
Answer: B
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The optimal decision rule is less than unanimity
a. True b. False
Total factor productivity is the ratio of a:
a. firm's marginal revenue to its marginal cost. b. firm's total revenues to its total costs. c. nation's total income to its total output. d. nation's output to its stock of labor and capital. e. nation's savings to its capital stock.
In a free market where a firm's activity causes detrimental externalities,
a. marginal benefits will be less than marginal social costs. b. smaller outputs than those that maximize profits will be socially desirable. c. marginal social cost will be greater than marginal private cost. d. All of the above are correct.
A business that is owned by one individual is a? __________.
A. master limited partnership B. partnership C. limited liability company D. corporation E. sole proprietorship