Price elasticity of demand shows how:
a) To compute the slope of the demand curve.
b) Price responds to demand changes.
c) Quantity demanded responds to price changes.
d) Quantity demanded responds to changes in the price of other goods.
Answer: c) Quantity demanded responds to price changes.
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If the federal funds rate is above the equilibrium federal funds rate, then the supply of reserves would be __________ than the demand for reserves and the banks would try to __________ reserves causing the federal funds rate to fall
A) greater than; lend B) greater than; borrow C) less than; lend D) less than; borrow
When a bank loans out $1,000, the money supply
A. increases. B. decreases. C. does not change. D. None of the above is correct.
The fundamental invention underpinning the recent productivity acceleration is the:
A. fuel cell. B. microchip. C. Internet. D. personal computer.
Recall the Application about Bitcoin and other cryptocurrencies to answer the following question(s). According to the Application, the disadvantage to using Bitcoin is:
A. that is not backed by any government. B. that it can be used anonymously. C. that it can be used to transfer money without the use of traditional banks. D. the value of Bitcoin has varied sharply over time.