The market demand curve for money is
A. Upward-sloping to the right because people wish to hold more money at higher interest rates and less money at lower interest rates.
B. Vertical because it is a fixed amount regardless of changes in the interest rate.
C. Downward-sloping to the right because people wish to hold less money at higher interest rates and more money at lower interest rates.
D. Horizontal because it is determined by the individual.
Answer: C
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The key endogenous variable in endogenous growth theory is ________
A) the level of technology B) the productivity of research and development C) the growth rate of output D) the level of per capita income
The tendency for individuals to assign higher values to goods when they own the goods than when they do not possess the goods is known as the:
A) substitution effect. B) endowment effect. C) income effect. D) anchoring effect.
According to the above figure for a gasoline market, what happens when the price per gallon of gasoline jumps from $1 to $4?
A) A gasoline surplus is replaced by a gas shortage. B) The market moves from a shortage of 40 million gallons/day to a surplus of 50 million gallons/day. C) The market shortage is replaced by market equilibrium. D) A surplus of 40 million gallons/day results.
Natural monopolies occur when
a. government antitrust laws are too weak or not enforced b. negative externalities are present c. firms collude to set prices and divide the market among themselves d. one firm can service the market more cheaply than two or more firms can e. a public good is produced by a private firm