Monopolistically competitive firms are like perfectly competitive firms in that they both sell homogeneous products.
Answer the following statement true (T) or false (F)
False
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If the price of gasoline increases and the price of food remains the same, then real income measured in terms of
A) gasoline increases. B) gasoline decreases. C) food increases. D) food decreases.
Explain which of the following goods and services are included and which are not included in U.S. GDP:
a. Jacinda buys termite spray at her local Home Depot. b. Jacinda uses the termite spray she purchased at her local Home Depot to treat her house for termites. c. Arturo hires a pest control company to treat his house for termites. d. Jeannine sells her 1969 Pontiac GTO to a local car museum. e. Simon purchases a new John Deere tractor to use on his farm. f. Ravi purchases 2 round-trip airline tickets between Chicago and Las Vegas.
If AC < p where MR = MC
A) firms earn positive profits and new firms will enter. B) firms earn negative profits and existing firms will leave. C) firms earn zero profits and new firms will not enter and no existing firms will leave. D) None of the above.
Table 14.1Monetary Aggregates of the U.S. Financial SystemItemAmountCash held by public$250 billionTransactions deposits$1,000 billionRequired reserves$150 billionExcess reserves$0 billionU.S. bonds held by public$1,000 billionAssume an original balance sheet: Refer to Table 14.1. If the Fed changes the required reserve ratio to 10 percent, ceteris paribus, the lending capacity of the system would eventually
A. Increase by $500 billion. B. Increase by $50 billion. C. Decrease by $500 billion. D. Decrease by $50 billion.