Which of the following is TRUE of the Fed's credit policy?
A) The Fed has implemented a credit policy since 1914.
B) Today about 40 percent of the Fed's asset holdings are related to its conduct of credit policy.
C) The Fed's credit policy is extended only to U.S. financial institutions.
D) The Fed's objective for its credit policy is to reduce the federal funds rate.
Answer: B) Today about 40 percent of the Fed's asset holdings are related to its conduct of credit policy.
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The following question relates to an oligopoly market where the industry demand curve is P = 100 - Q. Derive the reaction curve for a Cournot duopolist where the industry demand curve is as stated above and the MC of production is zero.
What will be an ideal response?
Private spending on tools, plant, and equipment used to produce future output
What will be an ideal response?
A firm could continue to operate for years without ever earning a profit as long as it is producing an output where
A) MR < ATC. B) ATC > AVC. C) MR > AVC. D) AFC < AVC.
Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward