Mary decides to withdraw $500 out of her checking account. The impact of this transaction on the Banking System's balance sheet will be to:
A. only reduce reserves by the required reserve rate times $500.
B. only reduce checkable deposits by $500.
C. decrease reserves and checkable deposits by $500 respectively.
D. increase reserves and reduce checkable deposits by $500 respectively.
Answer: C
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National income equals gross domestic product
A) minus the consumption of fixed capital. B) minus government transfer payments. C) plus government transfer payments. D) plus sales taxes.
Suppose that IS and LM intersect at full-employment output. A leftward shift of IS will be followed by a __________ price level that shifts LM to the __________ in a return to full employment
A) rising; right B) rising; left C) falling; right D) falling; left
Marginal cost
A) cuts average variable cost and average fixed cost at their lowest point. B) cuts average variable cost and average total cost at their lowest point. C) rises and then falls. D) is the mirror image of marginal product.
Yoyo's Frozen Yogurt, Inc is thinking of building a new warehouse. They believe that this will give them $50,000 of additional revenue at the end of one year, $60,000 additional revenue at the end of two years, and $70,000 in additional revenue at the end of three years. If the interest rate is 5 percent, Yoyo would be willing to pay
a. $140,000, but not $150,000. b. $150,000, but not $160,000. c. $160,000, but not $170,000. d. $170,000, but not $180,000.