The expected effects of monetary expansion are
A. lower real interest rates.
B. exchange rate depreciation.
C. higher inflation.
D. All of these responses are correct.
Answer: D
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All twelve Federal Reserve Bank presidents
A) attend Federal Open Market Committee Meetings. B) vote on decisions regarding the discount rate. C) vote on decisions regarding the prime rate. D) vote on decisions regarding bank reserve requirements.
Provide two circumstances where monopoly may offer efficiency advantages over competition
Consider the following statements:
a. Soda drinkers purchase more soda from a grocery store that sells soda at a lower price than other rival grocery stores in the area. b. Homeowners do not take steps to increase security even though they believe it is more costly to allow burglaries than to install security monitoring equipment. c. Manufacturers produce less of a particular cell phone when its selling price rises. Which of the above statements demonstrates that economic agents respond to incentives? A) a only. B) b only. C) c only. D) a and b. E) a, b, and c.
Refer to the information provided in Figure 8.4 below to answer the question(s) that follow. 
Figure 8.4 Refer to Figure 8.4. If six microwave ovens are produced, average variable costs are
A. $50. B. $100. C. $150. D. $300.