If the reserve ratio was 100 percent, then:
A. maximum lending would occur.
B. banks would create money in the economy.
C. banks would lend all of their deposits.
D. no lending would occur using deposits.
Answer: D
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Which of the following statements is true?
a. In the case of positive externalities, a private market will produce too little of a good compared to the socially efficient level of output. b. In the case of positive externalities, a private market will produce too much of a good compared to the socially efficient level of output. c. Negative externalities occur when benefits accrue to individuals not directly involved in a transaction. d. Positive externalities occur when costs are imposed on individuals not directly involved in a transaction. e. In the case of negative externalities, a private market will produce too little of a good compared to the socially efficient level of output.
A monopoly is a market model in which just one firm sells a product with no close substitutes
a. True b. False Indicate whether the statement is true or false
Moral hazard occurs when:
a. Individuals and institutions do not bear the full cost of their own mistakes. b.Individuals and institutions make immoral decisions based on greed. c. General social decay leads to unethical business decisions. d. The actions of one (or a few) result cause harm to others, when the same would not occur if the actions were by many. e. All of the above are examples of moral hazard.
Which of the following transactions is included in GDP?
A. buying and selling of stocks and bonds B. government transfer payments C. the sales of houses produced in that given year D. sales of used goods