A price ceiling is only effective if it is above the market equilibrium
a. True
b. False
Indicate whether the statement is true or false
False
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When a commercial bank receives a deposit, it must keep part of the deposit as cash reserves to satisfy its
A) loan requirements. B) interbank loans. C) required reserves. D) securities and loans. E) excess reserves.
If the banking system has a required reserve ratio of 25 percent, the money multiplier is
A. 0.25. B. 1.25. C. 0.2. D. 4.0.
It is assumed in economics that people make decisions based upon
A) altruism. B) rational self-interest. C) tradition. D) governmental persuasion.
A common misperception about consumer demand is that
a. demand depends on many other variables. b. price is a major determinant of quantity. c. it is a fixed amount. d. quantity cannot be determined in advance. e. All of the above are correct.