Coffee and donuts are complements in consumption. Suppose bad weather in the coffee producing regions of the world, which shifts the coffee supply curve leftward
How do the general equilibrium price and quantity outcomes compare to the partial equilibrium outcomes for this situation? A) General equilibrium price and quantity are higher
B) General equilibrium price is higher and quantity is lower
C) General equilibrium price is lower and quantity is higher
D) General equilibrium price and quantity are lower
A
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Which of the following will result in a decrease in a consumer's purchasing power?
A) A decrease in the consumer's income B) An increase in the price of the good on the vertical axis C) An increase in the price of the good on the horizontal axis D) all of the above
If the Fed were to change the reserve requirement in an effort to increase the money supply, they would:
A. increase the reserve requirement. B. decrease the reserve requirement. C. open the discount window longer. D. increase the discount rate.
The fractional reserve system allows banks to create money by making loans based on the quantity of demand deposits they have
Indicate whether the statement is true or false
According to the graph shown, producer surplus is:
A. $10. B. $2. C. $20. D. $6.