Which of the following events would definitely cause a decrease in the equilibrium price of cotton shirts?
What will be an ideal response?
A decrease in the price of wool shirts and a decrease in the price of raw cotton.
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The required reserve ratio is 10 percent and Charlie deposits $3,000 in her checking account. The bank must
A) decrease reserves by $300. B) decrease reserves by $3,000. C) increase reserves by $3,000. D) increase reserves by $300. E) not change its reserves until Charlie decides to withdraw her funds.
Under which of the following circumstances is the principal-agent problem likely to be most serious
a. Between general practitioners and patients. b. Between surgeons and patients. c. Between hospitals and nurses. d. Between dentists and physicians. e. Between physicians and lawyers.
When a 2 percent increase in the price of automobiles generates a greater than 2 percent decrease in quantity demanded, then
a. price elasticity of demand for automobiles is less than one b. total revenue increases c. demand is price inelastic d. demand is unit elastic e. total revenue decreases
Which of the following will most likely occur during the recessionary phase of a business cycle?
A. Real GDP rises, and the unemployment rate falls. B. Real GDP declines, and the rate of inflation rises. C. The sales of most businesses decline, and the unemployment rate rises. D. Inflation rises, and employment/population ratio falls.