If the reserve ratio is 5 percent, then $600 of additional reserves can create up to
a. $30 of new money.
b. $3,000 of new money.
c. $12,000 of new money.
d. None of the above is correct.
c
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Quotas and tariffs both
A) decrease deadweight loss. B) restrict foreign trade. C) cause a loss of revenue to domestic producers. D) lower prices on imported goods.
Wally, Vijay, Sandra, and Consuela make up a software development team at Javasoft. The firm is considering implementing one of two incentive compensation schemes
In scheme A, each programmer receives an annual bonus if he or she meets all individual programming deadlines. In scheme B, members of the team share equally in a joint bonus if the team meets all of its product delivery deadlines. All four employees are equally talented but Wally is a slacker who does as little work as he can get away with. Which scheme might team members prefer? Which scheme will management prefer?
Negative externalities, such as air pollution, pose a social problem because they
a. benefit buyers but not sellers b. are intended and are market derived c. have a positive value for those who create them d. have a negative value for those who create them e. are difficult to internalize
On May 12, 2011, it cost U.S. $1.44 to buy one euro. How many euros would U.S. $1 buy?
a. 0.69 b. 1.44 c. 1.69 d. 2.44