If the public has correct rational expectations and the Fed reduces the level of banking reserves, it would be expected to result in:
a. a higher level of real output and a lower price level.
b. a lower price level but no change in real output
c. a higher price level and a reduced level of real output.
d. a higher price level but no change in real output.
b
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As shown in the above table, Sam enjoys sailing and skiing equally well. Which of the following is TRUE?
A) Sam will not consume the same number of hours of sailing and skiing if the price per hour of sailing is more than that of skiing. B) If the prices per hour of sailing and skiing are the same, Sam will not spend the same number of hours at each activity. C) The marginal utility of the 3rd hour of either sailing or skiing is 120. D) None of the above is true.
Suppose you purchase a call option to buy IBM common stock at $35 per share in September. The current price of IBM is 37 and the option premium is 4
What is the intrinsic value of the option? As the expiration date on the option approaches, what will happen to the size of the option premium?
A profit-maximizing monopolist, if producing at all, chooses a level of output where: a. total revenue is maximized
b. total cost is minimized. c. average total cost is minimized. d. marginal revenue equals marginal cost.
Refer to Figure 10.1. Suppose the individual is initially at point b. Based on the figure, the individual could afford to increase his utility by:
A. consuming more today and less tomorrow.
B. consuming more today and more tomorrow.
C. consuming more tomorrow and less today.
D. consuming less today and less tomorrow.