When the actual reserves held by a bank exceed the legal requirement, the bank
a. will have to borrow from the Fed.
b. has excess reserves, which can be used to extend additional loans.
c. cannot extend additional loans.
d. will have to reduce its outstanding loans.
B
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Suppose the full-employment equilibrium real wage rate is $11 per hour while the actual real wage rate is $12 per hour. If the actual real wage rate does not change, then
A) job rationing will decrease. B) the production function will shift downward. C) job search will decline. D) job rationing will occur. E) a positive Okun Gap will occur.
If the minimum efficient scale in toaster production is 500,000 units per year,
a. the average cost of producing 300,000 toasters is greater than the average cost of producing 500,000 b. the average cost of producing 300,000 toasters is equal to the average cost of producing 500,000 c. the total cost of producing 300,000 toasters is greater than the total cost of producing 500,000 d. the firm should not produce more than 500,000 toasters e. MC exceeds AC at 500,000 toasters
Which of the following is true of productive efficiency?
a. It is a situation in which the marginal benefit from the consumption of a good declines as increments of resources are added to a certain purpose. b. It is a situation in which it is impossible to produce more of one good without decreasing the quantity produced of another good. c. It is a situation in which the mix of goods being produced represents the allocation that society most desires. d. It is a situation in which costs that were incurred in the past cannot be recovered and thus do not affect current decisions.
What did NOT cause the 2008-2009 recession?
A. Decrease in AD B. Housing bubble burst C. Large banks and corporations shut down D. Improper fiscal policy E. Stock market and wealth decrease