It has been argued that the laws that prohibited branch banking were needed to protect consumers from large monopoly banks. Does that argument hold up to close scrutiny? Explain.
What will be an ideal response?
Actually, the laws may have created more monopoly power. Often small banks were protected from competition in the form of more efficient large banks. The barriers to entry that the anti-branching laws created resulted in a system of small, geographically fragmented banks that faced virtually no competition.
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Demand shifts due to changes in price.
Answer the following statement true (T) or false (F)
Which of the following is the best example of a good or service with an external benefit?
A) gasoline B) education C) garbage disposal D) fertilizers E) bread
According to the interest-rate-based monetary policy transmission mechanism, a decrease in the money supply will
A. lead to an increase in investment spending and a decrease in real GDP which is greater than the increase in investment spending. B. lead to an increase in investment spending and a decrease in real GDP that is equal to the increase in investment spending. C. lead to a decrease in investment spending and a decrease in real GDP which is greater than the decrease in investment spending. D. lead to a decrease in investment spending and an increase in real GDP that is equal to the decrease in investment spending.
The marginal revenue product is
A. the change in marginal revenue resulting from a one-unit change in variable input. B. the change in marginal output resulting from a one-unit change in variable input. C. the change in total revenue resulting from a one-unit change in variable input. D. the change in total output resulting from a one-unit change in variable output.