Fractional reserve banking is the system that
A. limits banks' activities from crossing state lines.
B. allows banks not to insure their deposits.
C. allows banks to keep smaller reserves than their deposits.
D. allows banks not to join the Federal Reserve System.
Answer: C
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Refer to Figure 4-1. Kendra's marginal benefit from consuming the first ice cream cone is
A) $9.00 B) $7.50 C) $3.50 D) $0.50
If a monopoly is price discriminating between two groups, A and B, based on observable customer characteristics, there is no difference in the marginal cost of selling to the two groups, and the elasticity of demand for group A is -1.5 while the elasticity of demand for group B is -2.1, which of the following is true?
A. The markup and price for group A customers will be higher than for group B customers. B. The markup and price for group B customers will be higher than for group A customers. C. The markup for group A customers will be higher than for group B customers, but there is not enough information to determine which price will be higher. D. The price for group A customers will be higher than for group B customers, but there is not enough information to determine which markup will be higher.
This graph represents the cost and revenue curves of a firm in a perfectly competitive market.
According to the graph shown, what is the market price?
A. P1 B. P2 C. P3 D. Cannot tell from the graph.
Which of the following may reduce the MC of companies emitting SO2 pollution?
A. The government eliminated subsidies to companies for reducing pollution. B. A study came out suggesting that additional cancers are linked to exposure to SO2 pollution. C. The government is subsidizing scrubbers which are devices that can be used to remove some SO2 pollution. D. Consumers are worried about the pollution and stopped buying the products from companies with high pollution.