In a system with 100% reserve requirement, banks cannot create loans.
a. true
b. false
Ans: a. true
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Assume goods X and Y are substitutes. An increase in the price of X would cause the demand for Y to increase
Indicate whether the statement is true or false
When the level of output is such that aggregate demand equals aggregate supply,
A. the economy is at the full-employment level of GDP. B. the economy is at equilibrium GDP. C. Both of the statements are true. D. Neither of the statements are true.
Costume jewelry is produced in a monopolistically competitive market. One producer finds that MR = MC = $3 when output is 700 necklaces. An economist studying this information can conclude that:
A. the producer is charging a price of $3. B. economic profit is $2,100. C. the producer charges a price greater than $3. D. new firms will want to enter.
Securitization can not help financial intermediaries
A) diversify their portfolios. B) avoid bankruptcy. C) attract more investors to buy and hold their securities. D) decrease the cost of borrowing.