A subsidy is sometimes used by government to correct the problems associated with
A) negative externalities.
B) positive externalities.
C) internal benefits.
D) external benefits.
Answer: B
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Bank A has checkable deposits of $800,000 and total reserves of $200,000. If the required reserve ratio is 0.11, the bank has required reserves of
a. $600,000. b. $88,000. c. $112,000. d. $22,000.
Diminishing marginal returns implies that:
A. marginal costs are decreasing. B. marginal costs are increasing. C. marginal costs are constant. D. marginal costs may be increasing or decreasing.
A price ceiling set above the equilibrium price will cause which of the following?
A. a surplus B. an increase in supply C. a shortage D. no effect on either the price or quantity
Japan has a fairly high saving rate and the level of saving in Japan is above domestic investment. Use the saving and investment equation to explain what Japan is doing with this excess of saving above domestic investment
What will be an ideal response?