Susan likes to drink sodas. The ________ soda Susan drinks, the ________ of the last soda
A) more; higher the marginal benefit
B) less; higher the opportunity cost
C) less; lower the marginal benefit
D) more; lower the marginal benefit
D
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What is the largest component of the federal budget?
A) discretionary spending B) entitlements and mandatory spending C) defense spending D) net interest
The following are possible examples of price discrimination, EXCEPT:
a. prices in export markets are lower than for identical products in the domestic market. b. senior citizens pay lower fares on public transportation than younger people at the same time. c. a product sells at a higher price at location A than at location B, because transportation costs are higher from the factory to A. d. subscription prices for a professional journal are higher when bought by a library than when bought by an individual.
If the Fed is going to create an environment for economic progress, it should focus on
A) the regulation of financial institutions in order to control excessive risk taking. B) keeping interest rates low. C) shifting back and forth between expansionary and restrictive monetary policy in order to better control the growth of real GDP. D) the achievement of price stability.
Explain the linkages in the causal chain when the Fed conducts a contractionary monetary policy. What will be the ultimate effect on GDP?
What will be an ideal response?