Equilibrium GDP could be upset by a change in
A. Any leakage or injection.
B. Leakages only.
C. Injections only.
D. Investment only.
Answer: A
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What causes new firms to enter into a monopolistically competitive market structure?
What will be an ideal response?
Assume that the required reserve rate is ten percent, banks want to hold excess reserves in an amount that equals three percent of deposits, and the public withdraws ten percent of every deposit in cash. An open market purchase of $1 million by the Fed will see banking system deposits increase by:
A. more than $1 million but less than $10 million. B. more than $10 million but less than $20 million. C. less than $1 million. D. exactly $1 million.
Refer to Figure 21.3. The best estimate of where diminishing marginal returns begin is at an output level of
A. 10. B. 40. C. 20. D. 30.
If ATC is rising, MC
A. must be below ATC. B. may be below ATC. C. must be above ATC.