Bank A has checkable deposits of $900,000 and total reserves of $112,000. If the required reserve ratio is 8 percent, the bank has excess reserves of
A) $40,000.
B) $72,000.
C) $13,440.
D) $4,000.
A
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Suppose an industry is made up of 25 firms, all with equal market share. The four-firm concentration ratio of this industry is
A) 16%. B) 20%. C) 25%. D) It cannot be determined from the information given.
A monopoly can be formed by a bandwagon effect. Which of the following products would most closely match the bandwagon effect?
A) the Atlanta Braves baseball club B) the Dell Computer C) the Apple iPod D) the Chevrolet Corvette
If supply is highly inelastic and demand shifts to the right:
A. price and quantity will hardly change at all. B. price will hardly change at all; quantity will rise significantly. C. price probably will rise significantly; quantity hardly changes at all. D. price will rise significantly as will quantity.
Economic reasoning predicts that there will be strong pressures to make real-world markets perfectly competitive.
Answer the following statement true (T) or false (F)