Which of the following would be a consequence of a bank choosing not to lend its excess reserves?
A. Increased risk-taking by the bank
B. An increase in the bank's reserve-deposit ratio
C. A decrease in the bank's required reserves
D. An increase in the bank's total reserves
Answer: B
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Refer to Table 4-8. Suppose that the quantity of labor supplied decreases by 40,000 at each wage level. What are the new free market equilibrium hourly wage and the new equilibrium quantity of labor?
A) W = $9.50; Q = 370,000 B) W = $10.00; Q = 350,000 C) W = $9.00; Q = 330,000 D) W = $8.00; Q = 390,000
Assumptions are necessary to
A) make economics a social science. B) define a set of circumstances where a model is most likely to apply. C) define the relationship between wants and resources under all circumstances. D) define the specific cause and effect relationship that is being explained by social sciences.
An increase in the Consumer Price Index indicates that
a. the real income of households is increasing. b. the purchasing power of the dollar is increasing. c. the cost of buying the typical bundle of goods consumed by households is increasing. d. the real net worth of consumers is increasing.
Starting from long-run equilibrium, an increase in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. lower; higher D. higher; potential