When a bank buys a bond from the Fed
A. its reserves initially increase.
B. its liabilities decrease.
C. its reserves initially decrease.
D. its liabilities increase.
Answer: C
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A bond with a high yield
A. gives investors a high return on their investments. B. gives investors a low return on their investments. C. sells for a high price. D. sells for a low price.
You rent a DVD of The Dark Knight Rises. The rental is for seven days and you watch the movie on the first day. You tell a friend about the film and your friend asks to come over and watch the movie with you before it is due back
What is your opportunity cost if you decide to watch the movie a second time instead of going to a football game? A) the entire cost of the movie rental, since you have already watched the movie B) one half the rental cost, because you have already watched the movie one time C) The answer depends on how much you liked the movie in the first place. D) the football game you forego by watching the movie again
A positively sloped long run average cost implies:
a. economies of scale. b. constant returns to scale. c. diseconomies of scale. d. diminishing marginal returns to a factor. e. increasing returns to scale.
After a hurricane in Florida knocked out the regional water supply for several days, the demand for bottled water increased sharply. In a market economy, how will this increase in demand affect the equilibrium price and quantity of bottled water?
A. Price will increase, and quantity will decrease. B. Price will decrease, and quantity will decrease. C. Price will decrease, and quantity will increase. D. Price will increase, and quantity will increase.