At a perfectly competitive firm’s short-run equilibrium level of output,
A. P = MR = MC.
B. P = MR, but MR does not equal MC.
C. P = MC, but MR does not equal MC.
D. MR = MC and P < MR.
Answer: A
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The number of dollars that the commercial banking system can add to the money supply for each dollar of new reserves created by the Fed
A) cannot legally be greater than 8 nor less than 2. B) is governed largely by reserve requirements and the form in which the public chooses to hold money. C) is less than one because a portion of new reserves must be retained in bank vaults or on deposit with the Fed. D) would increase if the public decided to transfer the amounts currently in commercial bank savings accounts into checking accounts.
How can increases in a country's total income improve health?
What will be an ideal response?
The Federal Reserve uses the federal funds rate as an operating target because
A) it is an excellent indicator of the economy's underlying inflation rate. B) it is very sensitive to bank reserve level changes. C) it is determined by the Treasury. D) the Fed sets the rate directly.
From Figure 6-2, we can determine that demand is ____ between P = 12 and P = 10 and ____ between P = 6 and P = 4.
A. elastic; elastic B. elastic; inelastic C. inelastic; elastic D. inelastic; inelastic