Vault cash is equal to $8 million, deposits by depository institutions at the central bank are $2 million, the monetary base is $30 million, and bank deposits are $100 million. The money multiplier is equal to
A. 5.0.
B. 4.0.
C. 2.5.
D. 3.0.
Answer: B
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Which of the following factors could cause the economy to experience supply-side inflation?
A) increased security about jobs and future income B) Develop new technology to increase productivity. C) government laws which say that the average work week must be reduced by one hour every year D) Increase the number of immigrants allowed into the country.
In order to increase society's well-being, measles vaccinations might be
a. taxed to discourage production b. subsidized to encourage production c. taxed to encourage production d. subsidized to discourage production e. provided without government intervention
The amount of compensation associated with the income effect of a price change is called:
A. a compensation variation. B. an income effect. C. consumer surplus. D. a subsidy.
How much total economic surplus would have been lost if the bread subsidy, as illustrated in Example 7.7, had been set at $0.50 per loaf instead of $1.00?