Moral suasion is
a. the minimum amount of reserves the Fed can persuade a bank to hold
b. the interest rate that the Fed can morally charge banks who borrow from it
c. the interest rate on loans made by banks to other banks
d. the maximum percentage of the price of a stock that can be borrowed from a bank, with the stock offered as persuasive evidence of collateral
e. an appeal by the Fed to banks, asking for voluntary compliance with the Fed's policies
E
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Sonya's budget for magazines and chocolate bars is $50. Her marginal utility from these goods is shown in the table above. The price of a magazine is $5 and the price of a chocolate bar is $2.50
Sonya currently buys 4 magazines and 12 chocolate bars. To maximize her utility, she should A) buy more chocolate bars and fewer magazines. B) buy more magazines and fewer chocolate bars. C) buy more of both goods. D) stay with the current combination of goods.
Answer the following statements true (T) or false (F)
1. The study of economics is primarily theoretical and has very little practical application. 2. Economics is considered a physical science. 3. Economies must make choices because resources are limited while wants are unlimited. 4. Production is the creation or addition of utility.
Under the National Banking Acts of 1863 and 1864, the U.S. monetary system
(a) experienced drastic changes. (b) played a role in helping the Union finance the Civil War. (c) permitted, for the first time, the federal government to charter banks. (d) protected the rights of states to be the only entities to charter banks.
Wendy claims that the right mix of hamburgers and other goods is being produced, but that they are not being produced in the least costly way. How would an economist assess Wendy's claim?
A. Wendy is asserting that productive efficiency is realized in hamburger production, but not allocative efficiency. Wendy's assertion cannot be correct. B. Wendy is asserting that allocative efficiency is realized in hamburger production, but not productive efficiency. Wendy's assertion may be correct. C. Wendy is asserting that productive efficiency is realized in hamburger production, but not allocative efficiency. Wendy's assertion may be correct. D. Wendy is asserting that allocative efficiency is realized in hamburger production, but not productive efficiency. Wendy's assertion cannot be correct.