The lending ability of the banking system increases if the:
a. Reserve ratio rises.
b. Preferred asset ratio for customary reserves rises.
c. Preferred asset ratio for near money rises.
d. Demand to hold money rises.
e. All of the above.
.C
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Positive and negative externalities can lead to market failure
Indicate whether the statement is true or false
If fast food is an inferior good then:
A. the quantity of fast food demanded will rise as the price of fast food rises. B. the demand for fast food will fall as income falls. C. the demand for fast food will fall as income rises. D. the demand for fast food will fall as the price of fast food rises.
The school of economic thought which argues that through tax reductions, and deregulation, government creates the proper incentives for the private sector to increase aggregate supply is known as the:
A. rational expectations school. B. neo-Keynesian school. C. supply-side school. D. classical school.
The rational outcome of a low-price guarantee policy is that:
A. both firms will sell at the low price. B. one firm will sell at a low price and the competitor will sell at a high price. C. both firms will sell at the high price. D. consumers will be better off.