The product-variety externality states that entry of a new firm conveys a negative externality on consumers
a. True
b. False
Indicate whether the statement is true or false
False
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Office workers and word processing programs are complements if:
A. a decrease in the wage paid to office workers leads to an increase in the demand for word processing programs. B. a decrease in the wage paid to office workers leads to a leftward shift in the demand for word processing programs. C. an increase in the price of word processing programs leads to an increase in the demand for office workers. D. they perform similar functions.
What two fiscal policy actions could the government take if it wants to stimulate the economy during a recession? What two fiscal policy actions could the government take if it wants to slow the economy down during a period of rapid growth and
increasing inflation?
Which of the following items serve as a unit of account?
I. $100 cash II. checkable deposits III. an original Picasso painting IV. a $1,000 corporate bond that you own A) I only B) I and II C) I, II, and III D) I, II, and IV E) I, II, III, and IV
Exhibit 20-3 Money market demand and supply curves
?
In Exhibit 20-3, assume an equilibrium with an interest rate of 15 percent and the money supply at $100 billion. The Fed uses its policy tools to move the economy to a new equilibrium at E2 with money supply of $150 billion and an interest rate of 10 percent. This change could be the result of a(n):
A. open market sale of securities by the Fed. B. higher discount rate set by the Fed. C. higher required-reserve ratio set by the Fed. D. open market purchase of securities by the Fed.