According to the classical model, the income generated by production is
A. enough to purchase all the goods and services produced.
B. fully spent on savings.
C. enough to meet the needs of everyone in society.
D. always insufficient to purchase all the goods and services produced.
Answer: A
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If a union threatens to strike during a slow demand period, it is more likely to
a. Have its conditions accepted b. Have its conditions rejected c. Get laughed at d. All of the above
The legal requirement that commercial banks hold reserves equal to some fraction of their deposits
a. limits the ability of banks to expand the money supply by extending additional loans. b. prevents the Fed from controlling the money supply since commercial banks can always offset the actions of the Fed. c. prevents runs on banks by depositors who fear that banks have insufficient assets to meet the claims of their depositors. d. limits the ability of the Treasury to expand the national debt.
A shortage exists when
A. QD=QS.
B. QD
A commercial bakery makes white bread and wheat bread. Therefore, a decrease in the market price of white bread tends to
A) increase the demand for wheat bread. B) increase the demand for white bread. C) increase the baker's cost of making wheat bread. D) decrease the baker's cost of making wheat bread.