A structured and simplified version of reality that can be used to explain real-world behavior is called
A) an economic model.
B) a rationality assumption.
C) a postulate.
D) a normative alternate reality.
A
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Refer to Figure 4.1, which shows Molly's and Ryan's individual demand curves for compact discs per month. Assuming Molly and Ryan are the only consumers in the market, what is the market quantity demanded at a price of $3?
A) 6 B) 9 C) 15 D) 20
If the required reserve ratio is 5 percent, currency in circulation is $400 billion, checkable deposits are $800 billion, and excess reserves total $0.8 billion, then the M1 money multiplier is
A) 2.5. B) 2.72. C) 2.3. D) 0.551.
Which of the following is TRUE about firms organized along functional lines?
a. Workers find it difficult to develop functional expertise b. Workers can easily share information within their division c. They inhibit the exploitation of economies of scale d. All of the above
Assume that foreign capital flows into a nation rise due to expected increases in stock market appreciation. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the real risk-free interest rate and GDP Price Index in the context of the Three-Sector-Model? a. The real risk-free interest rate falls and GDP Price Index rises
b. The real risk-free interest rate falls and GDP Price Index falls. c. The real risk-free interest rate rises and GDP Price Index falls. d. The real risk-free interest rate and GDP Price Index remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.