Attempts to keep the economy always within a hair's breadth of full employment is called
a. shock absorption.
b. lagging.
c. fine tuning.
d. crowding out.
c
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Refer to Figure 12-7. If the market price is P1
A) The firm will experience a loss since price is less than ATC. B) The firm will experience a loss and raise its price to P2. The firm will then break even. C) The firm may make a profit if it can increase the demand for its product. D) The firm will break even by producing a quantity of Q2.
Accounting profit is usually larger than economic profit.
Answer the following statement true (T) or false (F)
Assume that the central bank increases the reserve requirement. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the GDP Price Index and reserve-related (central bank) transactions in the context of the Three-Sector-Model?
a. The GDP Price Index falls, and reserve-related (central bank) transactions become more negative (or less positive). b. The GDP Price Index falls, and reserve-related (central bank)transactions remain the same. c. The GDP Price Index and reserve-related (central bank) transactions remain the same. d. The GDP Price Index rises, and reserve-related (central bank) transactions remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
When the required reserve ratio is 10% and the banks deposits are $50 million, the bank can make up to $45 million in loans
a. true b. false