A banker operating under a system of fractional reserves
a. is exposed to potential bank runs.
b. must keep a prudent level of reserves.
c. must lend money carefully.
d. All of the above are correct.
d
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Total variable cost
A) increases as output increases. B) does not change as output changes. C) decreases as output increases. D) initially decreases and then increases as output increases.
Due to society's overall scarcity of resources,
a. only households are constrained by income b. only government agencies are constrained by limited budgets c. only business firms are constrained by the cost of buying their inputs d. households, business firms and government agencies all face constraints e. households and business firms face constraints, but government agencies do not
The national debt is
A. The accumulation of all annual deficit and surplus flows. B. A fairly risky asset that pays interest. C. The amount by which government spending exceeds tax revenues for a given year. D. The amount by which tax revenues exceed government spending for a given year.
In order to differentiate their product brands from those of competing firms, monopolistically competitive firms
A. advertise their product. B. spread false rumors about their competitors. C. take their competitor's reactions to changes in their policies into account. D. equate marginal cost to marginal revenue to determine the profit maximizing quantity.