If the Federal Reserve System lowers the legal reserve requirement, it forces banks to hold repaid loans as required reserves instead of lending them again, thus shrinking the money supply
Indicate whether the statement is true or false
F
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Which of the following is true when an economy is in long-run equilibrium?
What will be an ideal response?
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, as the economy moves from Point A to Point E, the opportunity cost of motorcycles, measured in terms of hybrid cars
A. remains constant. B. decreases. C. initially increases, then decreases. D. increases.
If business leaders expect the new Congress to lower the corporate profits tax, most likely this will cause business firms, ceteris paribus, to
A. plan to decrease investment in the future to compensate for the lower tax rate. B. increase investment because the lower corporate profits tax will increase the return on any investment. C. decrease investment because they would expect lower benefits from investment. D. not change their investment plans because lower corporate profit taxes will not change the demand for their product.
A perfectly competitive firm will earn positive economic profits in the range of output for which the firm's price is ________ its minimum average total cost.
A. above B. equal to C. below D. below its marginal cost and