Other things equal, if the required reserve ratio was lowered:
A. banks would have to reduce their lending.
B. the actual reserves of banks would increase.
C. the size of the monetary multiplier would increase.
D. the Federal funds interest rate would rise.
Answer: C
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A major technological advance would be represented on a production possibilities curve by a(n):
a. movement off the production possibilities curve toward a point outside the curve. b. movement toward the curve from a point inside the curve. c. outward shift of the entire curve. d. movement to the left along the curve to a higher point.
Chicken and fish are substitutes. Therefore, the cross elasticity of demand between chicken and fish is
a. negative. b. positive. c. zero. d. Any of the above is possible.
What is the opportunity cost of going from point D to point C?
Marginal product refers to ______, and marginal revenue product refers to______.
a. labor; the value of economic and accounting profits b. a change in output; revenue gained from that change c. capital; income gained through investments in capital d. derived demand for labor; an increase in profitability