As a result of the given transactions, the supply of money in the economy will:
Answer the question on the assumption that the legal reserve ratio is 20 percent. Suppose that
the Fed sells $500 of government securities to commercial banks (paid for out of commercial
bank reserves) and buys $500 of securities from individuals, who deposit the cash in checking
accounts.
A. remain unchanged.
B. rise by $500.
C. fall by $100.
D. fall by $500.
B. rise by $500.
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The figure above shows that the deadweight loss from the tariff is
A) $20 million per year. B) $30 million per year. C) $15 million per year. D) $55 million per year. E) zero.
In the above figure, along which range would total revenue rise by lowering prices?
A) between point a and point b B) between point c and point d C) between point d and point e D) below point e
What will cause the equilibrium point to move from E1 to E2?
a. a downward movement, or decrease, in price from P1 to P2
b. an upward movement, or increase, in price from P2 to P1
c. a leftward movement, or decrease, in quantity from Q2 to Q1
d. a rightward movement, or increase, in quantity from 0 to Q2
Recall the Application about the decrease in the price of wool in the 1990s to answer the following question(s). In the 1990s, the world price of wool decreased by about 30 percent and prices have remained relatively low since then. In 2012, an organization in New Zealand proposed that sheep shearing be added to the Commonwealth Games and the Olympics as a spectator sport in an effort to increase the awareness and the demand for wool.Recall the Application. As the world price of wool decreased, the quantity of wool supplied by individual ranchers would ________, and the quantity supplied in the world market would ________.
A. increase; increase B. increase; decrease C. decrease; decrease D. decrease; increase