A firm that was initially a monopsonist, but now has to buy from a competitive resource market will:
a. buy more amount of resources and pay a higher price for these resources.
b. buy the same amount of resources and pay a higher price for these resources.
c. buy less amount of resources and pay a lower price for these resources.
d. buy less amount of resources and pay a higher price for these resources.
e. buy more amount of resources and pay a lower price for these resources.
a
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Starting from long-run equilibrium, a large tax cut will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; higher B. expansionary; higher; potential C. recessionary; higher; potential D. recessionary; lower; lower
Suppose the desired reserve ratio is 10 percent. If Urban Bank has total deposits of $1000 and total assets of $10,000, the amount of desired reserves is
A) $9,000. B) $900. C) $100. D) $1,000. E) $1,100.
According to the BEA, in the second quarter of 2012 federal government spending on goods and services changed by -0.1 percent. This decrease could have been caused by a decrease in spending on
A) national defense. B) Social Security. C) interest payments on the national debt. D) unemployment benefits.
Money is almost always used to quote prices. This illustrates the function of money as a
A. medium of exchange. B. store of value. C. unit of account. D. commodity value.