If the Federal Reserve ________ the required reserve ratio, the interest rate ________
A) lowers; rises
B) lowers; falls
C) raises; does not change
D) raises; falls
E) Not enough information is given because the effect depends also on the size of the monetary base.
B
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The forecasting technique which involves the use of the least squares statistical method to examine trends, and takes into account seasonal and cyclical fluctuations, is known as
A) compound growth rate projection. B) the Delphi method. C) time series projection. D) exponential smoothing projection.
Which of the following is considered a microeconomic topic?
A. The review of quarterly national income accounting data B. A firm’s decision to purchase pay-per-click online advertising C. The Federal Reserve decides to increase the discount rate D. The CPI reports a rise in inflation during July
Suppose that consumers become more pessimistic about the future and, as a result, reduce their consumption by $10 billion. If the marginal propensity to consume is 0.80, how will this $10 billion reduction in consumption affect the equilibrium level of real GDP?
a. Real GDP will decrease by $8 billion. b. Real GDP will decrease by $10 billion. c. Real GDP will decrease by $40 billion. d. Real GDP will decrease by $50 billion.
In the following graph, the price of capital is $100 per unit; the price of labor is $25 per unit. When output is 30 units, what is TOTAL cost?
A. $10,000 B. $20,000 C. $2,000 D. $1,000 E. none of the above