If the price of a company's stock truly reflects the value of a share in the company, then
A. abrupt stock price changes reflect abrupt changes in the public's perception of fundamentals and risk.
B. stock prices can only change abruptly when accounting scandals are uncovered, as in 2002.
C. it is impossible for the stock price to change by 20% in a single day, as in 1987.
D. it is impossible for the stock price to increase by 84% within a single year, as in 1999.
Answer: A
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Answer the question based on the following information on the banking system. Deposits at the central bank = 200 U.S. Government Securities = 600 Checking Deposits = 1,700 Loans = 800 Stockholder's Equity = 70 Other Assets = 450 Other Liabilities = 230 Borrowing from the central bank = 100 Cash in the Vault = 50 The reserve ratio on transactions deposits = 10% The banking system's excess reserves
equal: a. 0 b. 134 c. a multiple of 250 d. 1,584 e. None of the above is correct
Assuming aggregate supply is upward-sloping and aggregate demand is downward-sloping, a sudden reduction in a nation’s exports will
a) cause inflation b) cause recession c) cause stagflation d) increase GDP and reduce prices e) increase GDP and raise equilibrium prices
Which of the following statements is true?
A. The balance of payments is always in balance. B. An increase in exports causes a balance of payments surplus. C. A decreases in imports causes a balance of payments surplus. D. A decrease in exports causes a balance of payments deficit.
On the vertical axis, the production possibilities frontier shows ________; on the horizontal axis, the production possibilities frontier shows ________
A) the quantity of a good; the number of workers employed to produce the good B) the quantity of a good; the price of the good C) the quantity of a good; a weighted average of resources used to produce the good D) the quantity of one good; the quantity of another good