In some circumstances, selling pollution permits may be better than levying a corrective tax
a. True
b. False
Indicate whether the statement is true or false
True
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Critics of the extreme rational expectations theory argue that wages and input prices do not adjust instantaneously
a. True b. False Indicate whether the statement is true or false
Assume that business investment spending rises, and the increase is funded by greater borrowing in the capital markets. If the nation has low mobility international capital markets and a fixed exchange rate system, what happens to the GDP Price Index and reserves account in the context of the Three-Sector-Model? a. The GDP Price Index rises and reserves account becomes more positive (or less
negative). b. The GDP Price Index falls and reserves account remains the same. c. The GDP Price Index and reserves account remain the same. d. The GDP Price Index rises and reserves account remains the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
How does the substitution effect work when the price of item increases?
A. The item becomes less and less popular as price drops B. Consumers buy the cheaper item B as a substitute for item A C. Consumers buy item A even if they do not particularly want it D. The substitutes for item A also increase in price
In September 2008, Regions Bank has $89 million in M1 deposits, $3 million in reserves and $81 million in loans. Regions Bank's desired reserve ratio is
A) 3.4 percent. B) 3.7 percent. C) 91 percent. D) 29.67 percent.