A monopoly occurs when
A. A firm gains some level of market power.
B. There is an underproduction of a good or service by a firm.
C. There is only one producer of a particular good or service.
D. A firm charges a price greater than the equilibrium price.
Answer: C
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Assume that Figure 4-16 shows the supply of soda. An increase in the price of syrup used in the production of soda will shift supply from
A. S1to S2. B. S2to S1. C. S2to S3. D. S1to S3.
The regulator that determines the permissible activities any bank may engage in is the
A) Federal Reserve. B) FDIC. C) House Banking Committee. D) Comptroller of the Currency.
If people use quartz as a medium of exchange, then they: a. have a barter economy
b. are using commodity money. c. are using token money. d. are using legal tender. e. are using fiat money.
When the required reserve ratio is changed,
a. the money multiplier is changed but the amount of excess reserves in the banking system is unchanged. b. the money multiplier is unchanged but the amount of excess reserves in the banking system is changed. c. the size of the money multiplier and the amount of excess reserves change in the opposite direction from the required reserve ratio. d. the size of the money multiplier and the amount of excess reserves change in the same direction as the required reserve ratio. e. neither the money multiplier nor the amount of excess reserves change.