Assume the Fed purchases $5,000 worth of U.S. Treasury bonds from Bill Gates, who promptly deposits the money in Microsoft Rules National Bank. Assuming that the required reserve ratio is 25 percent and banks keep zero excess reserves, then the money supply will ultimately:
a. increase by a maximum of $5,000.
b. increase by a maximum of $20,000.
c. decrease by a maximum of $5,000.
d. decrease by a maximum of $20,000.
b
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International trade is definitely in the social interest if
A) consumer surplus increases. B) producer surplus increases. C) consumer surplus does not decreases. D) producer surplus does not decreases. E) total surplus increases.
Producer surplus is the
A) cost of the good summed over the quantity sold. B) demand for a good minus the supply summed over the quantity sold. C) price of a good minus the marginal cost of producing it summed over the quantity sold. D) marginal cost of producing it summed over the quantity sold.
The above table shows the total product schedule for the campus book store. If each employee is paid $6 per hour, what is the average variable cost of selling 83 books per hour (assuming labor costs are the only variable costs of production)?
A) $0.43 per book B) $0.07 per book C) $2.30 per book D) $6.00 per book
All else equal, the ________ the coupon rate on a bond, the ________ the bond's duration
A) higher; longer B) higher; shorter C) lower; shorter D) greater; longer