Static gains from trade come about because trade causes consumers and producers to face a different set of prices
Indicate whether the statement is true or false
TRUE
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A well-capitalized bank:
A) does not have stockholders' equity. B) is prone to bank runs. C) owns far more than it owes. D) only accepts deposits but does not advance loans.
Given an aggregate supply curve, a decrease in aggregate demand will: a. increase the real interest rate
b. increase real GDP. c. increase the price level. d. decrease the real exchange rate. e. decrease real GDP.
If it is discovered that using drugs enhances a person's chance of contracting a lethal disease, the cost of using drugs
A) increases. B) decreases. C) is not affected. D) is irrelevant, since they are illegal anyway.
Which of the following would result in a movement along the production possibilities curve?
A) a fall in the unemployment rate B) growth in the capital stock C) population growth D) a change in the outputs of two goods that a society chooses to produce