If banks are currently holding zero excess reserves and the Fed lowers the required reserve ratio, which of the following will happen?
A) Banks will have a reserve deficiency.
B) Banks will have positive excess reserves.
C) Banks will extend fewer loans.
D) Banks will call in some of their loans to meet the reserve deficiency.
B
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Assume that the marginal propensity to consume in an economy is 0.9. If the economy's full-employment real GDP is $500 billion and its equilibrium real GDP is $550 billion, there is an inflationary expenditure gap of
A. $5 billion. B. $500 billion. C. $100 billion. D. $50 billion.
Unlike a perfectly competitive firm, a monopolist
a. can choose how much output to produce. b. cannot increase production without affecting the price she receives for her good. c. usually sells in a market with a downward-sloping demand curve. d. has an MR from increasing output by one unit equal to the price of his product.
This graph below shows a consumer facing a choice between a cash gift and merchandise of greater value. 
Show, using a sketch graph, why a consumer prefers a cash gift rather than a larger gift of merchandise.
What will be an ideal response?
The MRP schedule of the imperfect competitor declines _____ than that of the perfect competitor.
Fill in the blank(s) with the appropriate word(s).