What do we mean when we say that a good is rival in consumption?
A good is rival in consumption if one person's use of the good reduces another person's ability to use it.
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According to this Application, the Fed started paying interest to banks on reserves. All else equal, this would tend to ________ on a bank's balance sheet
A) increase reserves B) increase loans C) increase deposits D) all of the above
Substitution effects help explain the slope of the aggregate demand curve. One substitution effect refers to the
A) inverse relationship between the interest rate and the price level. B) direct relationship between the interest rate and the real value of wealth. C) effect on investment expenditures that result from a change in interest rates produced by a change in the price level. D) change in wealth that results from a change in the interest rate.
An economic slow-down predicts the new equilibrium wage would be:
A. lower because the labor demand curve shifts left. B. higher because the labor demand curve shifts left. C. lower because the labor demand curve shifts right. D. higher because the labor demand curve shifts right.
A firm has market power if it can raise the price of its product and still sell product to customers.
Answer the following statement true (T) or false (F)