Because a famous airplane like the Spruce Goose is fixed in supply, its price is
A. inelastic.
B. independently determined.
C. supply determined.
D. demand determined.
Answer: D
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A long-run ATC curve shows:
A. the minimum average total cost possible for every possible size firm across an industry. B. which size firm can capture the lowest costs per unit for an industry. C. what size firms can capture economies of scale by expanding. D. All of these are true.
If M stands for the money supply, V for the velocity of money, P for the average selling price, and Q for the output of goods and services, the equation of exchange is:
a. MP = VQ. b. MV = PQ. c. MQ = VP. d. MP = PQ.
Which of the following is not an example of a negative externality?
A. noise created by commercial aircraft B. clearnup costs for an oil spill C. a computer company's costs of raw materials D. congestion and delays caused by traffic jams
The reserve ratio is 20 percent. The Fed buys $1 million in government securities from a bond dealer by transmitting the funds to the dealer's deposit account at Bank A. Bank A loans the maximum amount possible to a construction company, which buys materials from a lumber yard. The lumberyard deposits the construction company's check in Bank B. What is the maximum loan Bank A can now make and the maximum loan Bank B can now make?
A. Bank A: 0; Bank B: $640,000 B. Bank A: 0; Bank B: $800,000 C. Bank A: $800,000; Bank B: 0 D. Bank A: $800,000; Bank B: $640,000