Refer to the above table. If opportunity costs are constant, then the opportunity cost of producing good B in country X is ________, and the opportunity cost of producing good B in country Y is ________
A) 1 unit of A; 2 units of A
B) 1 unit of A; 0.5 unit of A
C) 1 unit of B; 2 units of A
D) 1 unit of A; 0.5 unit of B
A
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The nominal interest rate in Autarkia has risen sharply after a change in a government policy. How will this affect the economy if the wages in the country are downwardly rigid?
What will be an ideal response?
Price discrimination is prevented in situations where
A) customers can resell the good. B) firms have monopolies. C) there are legal barriers to entry. D) there are no close substitutes for the good or service. E) customers have different willingnesses to pay for the good.
Netflix introduced DVD rentals via US Mail whereby customers do not have to leave their home to rent movies. They also introduced the concept of no-late fees. Netflix has enjoyed strong profits over the last few years
However, what does economic theory tell us should happen to these profits in the long run and why?
A bank's assets consist of $1,000,000 in total reserves, $2,100,000 in loans, and a building worth $1,200,000 . Its liabilities and capital consist of $3,000,000 in demand deposits and $1,300,000 in capital. If the required reserve ratio is 10 percent, what is the level of the bank's excess reserves? How much could it loan out as a result?
a. $700,000; $700,000 b. $700,000; $7,000,000 c. $300,000; $300,000 d. $300,000; $3,000,000