Assume that the marginal cost of growing pine trees does not include the benefit to the environment as a result of carbon dioxide reduction. By producing where P = MC, the grower will be producing ________ the efficient amount of pine trees.
A. more than
B. less than
C. exactly
D. sometimes more and sometimes less than
Answer: B
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A price ceiling is a legally determined maximum price that sellers may charge
Indicate whether the statement is true or false
Demand-pull inflation is caused by: a. an increase in aggregate demand
b. a decrease in aggregate demand. c. an increase in short-run aggregate supply. d. a decrease in short-run aggregate supply.
A bank faces a required reserve ratio of 5 percent. If the bank has $200 million of checkable deposits and $15 million of total reserves, then how large are the bank's excess reserves?
a. $10 million b. $0 c. $5 million d. $15 million
The wage rate that a monopsonist would find most profitable is the wage
A. On the labor supply curve corresponding to the level of employment at which the marginal factor cost curve (for labor) intersects the labor demand curve. B. On the labor demand curve at the wage where the marginal factor cost curve intersects the demand curve for labor. C. At the intersection of the marginal wage curve and the marginal cost curve. D. On the labor demand curve corresponding to the level of employment at which the marginal factor cost equals market supply.