What will happen to the demand for beers such as Natural Light, Coors Light and Bud Light near college towns if students' income increased tremendously?
a. Demand will fall because students love these beers
b. Demand will fall because these beers are considered inferior goods
c. Demand will rise because these beers are considered inferior goods
d. Demand will not change as students are already maximizing their drinking capacity
b
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In a small town of 100 people, there are 10 children under 16, 10 retired people, 60 people with full-time jobs, 3 people with part-time jobs, 3 full-time students over 16, and 4 full-time homemakers. The remaining people did not have jobs, but wanted them. What is the participation rate in this town?
A. 87.5% B. 72.0% C. 81.1% D. 63.0%
When government levies pollution taxes on sellers to eliminate the inefficiency from the cost of pollution, the result is
A) a lower price. B) a smaller quantity produced. C) a smaller cost of production. D) a rightward shift of the supply curve. E) leftward shifts of the supply and demand curves.
Suppose a bank has $100 million in checking account deposits with no excess reserves and the required reserve ratio is 10 percent. If the Federal Reserve reduces the required reserve ratio to 8 percent, then the bank can make a maximum loan of
A) $0. B) $2 million. C) $8 million. D) $10 million.
Why is it more difficult for the Fed to control the money supply today than it was fifty years ago?
What will be an ideal response?