Producer surplus increases as the price of a good decreases.
Answer the following statement true (T) or false (F)
False
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The price of a factor of production that is in fixed supply is called
A) opportunity cost. B) a compensating differential. C) economic rent. D) economic profit.
Assume that an American investor decides to buy one-year Swiss bonds that are denominated in Swiss francs and pay 2 percent annual interest. For this purpose, $10,000 is exchanged into Swiss francs at an exchange rate of $1 = 2Fr to buy the bonds. How many dollars will the investor have after one year if the exchange rate is $1 = 1.5Fr?
a. $10,000 b. $10,200 c. $15,300 d. $13,600 e. $7,650
Which of the following is NOT a reason social returns might be greater than private returns?
A) Excess competition between firms B) Knowledge spillovers C) Spillovers from research and development D) Capital market imperfections
Refer to the information provided in Scenario 25.1 below to answer the question(s) that follow.SCENARIO 25.1: The following table shows the changes in deposits, reserves, and loans of 4 banks as a result of a $100,000 initial deposit in Bank No. 1. Assume all banks are loaned up.
Refer to Scenario 25.1. What is the required reserve ratio?
A. 4% B. 5% C. 8% D. 10%