If an individual is to hold lower money balances on average, she must make more frequent trips to the bank to withdraw money. This inconvenience of reducing money holding is called:
A. a menu cost.
B. a shoeleather cost.
C. an inflation tax.
D. seigniorage.
Ans: B. a shoeleather cost.
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Which of the following appears as an asset on the Federal Reserve's balance sheet?
A) Capital accounts B) U.S. Treasury deposits C) U.S. government securities held under repurchase agreements D) Federal Reserve notes outstanding
Demand is said to be inelastic when
A) a given percentage change in price will result in a less than proportionate percentage change in the quantity demanded. B) demand exhibits zero responsiveness to price changes. C) small price increases will lead to zero quantity demanded. D) a given percentage change in price will result in a greater than proportionate percentage change in the quantity demanded.
Government antitrust laws were designed to
a. encourage the production of public goods b. prevent natural monopolies c. prevent collusion among firms d. regulate natural monopolies e. correct the outcomes of positive and negative externalities in private markets
A weak U.S. dollar is one that has:
a. c and e. b. d and e. c. depreciated. d. appreciated. e. helped U.S. exporters.