When bank deposits increase from $1 million to $2 million, banks' required reserves increase from $100,000 to $200,000. The required reserve ratio is ________
A) 10.0
B) 0.10
C) 1.00
D) 0.25
B
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Limit pricing refers to
A) the fact that a monopoly firm always sets the highest price possible. B) how the price is determined in a kinked demand curve model of oligopoly. C) a situation in which a firm might lower its price to keep potential competitors from entering its market. D) none of the above.
A government policy that would raise the rate of productivity growth is
A) shifting infrastructure expenditures to the private sector. B) taxing expenditures on research and development. C) reducing the government budget surplus. D) improving human capital development.
A decrease in the money supply causes the interest rate to rise so that investment falls
a. True b. False Indicate whether the statement is true or false
When two goods are perfect substitutes, the marginal rate of substitution
a. is constant along the indifference curve. b. decreases as the scarcity of one good increases. c. increases as the scarcity of one good increases. d. changes to reflect the consumer's changing preferences for the goods.