The study of individual choice is a focus in:
A. microeconomics.
B. macroeconomics.
C. Ricardian economics.
D. normative economics.
Answer: A
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If credit card usage exhibits a sharp increase, there is
A) an upward movement along the demand for money curve. B) a rightward shift of the demand for money curve. C) a leftward shift of the demand for money curve. D) a downward movement along the demand for money curve. E) a leftward shift of the supply of money curve.
Craig quit a job earning $12,00 . per year to open his own lawn-care service. Yesterday, he was offered a job earning $20,00 . per year at Home Depot, but he turned it down to continue running his lawn-care service. Assuming that his total revenue (= P
× Q) has not changed, (a) explain the impact of this job offer on Craig's economic profit, and (b) explain the impact of this job offer on his normal profit.
A bank currently has $50 million in deposits, $6 million in cash in the vault, $4 million on deposit with the Fed, and $5 million in government securities. The reserve ratio is 20 percent. A new deposit is made of $1 million. What is the maximum size loan the bank can make once the check clears?
A. 0 B. $1 million C. $5.8 million D. $800,000
The long-run average cost curve
A. is a curve which is tangent to each member of a set of short-run average cost curves. B. is always a downward sloping straight line. C. is identical to the marginal cost curve. D. should always be horizontal.