Commercial banks create money by:
a. printing currency notes
b. charging processing fees on bank transactions.
c. making loans out of excess reserves.
d. investing in money market mutual funds.
c
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You pay $15 for an all-you-can-eat buffet. The food isn't so good, but definitely edible. When you finish eating, what is the marginal value of the last bite of food you consumed?
A) zero B) $15 C) positive D) negative
The Federal Trade Commission
a. prevents mergers that substantially lessen competition. b. rules on the antitrust activities of labor unions. c. issues patents. d. polices deceptive advertising.
The theory of rational expectations implies which of the following?
a) unemployment and the rate of inflation are directly related b) an increase in the money supply will have no effect on price level c) attempts to decrease unemployment below the natural rate lead to depression d) attempts to decrease unemployment through government policy will be thwarted by people's reactions e) government policies work only if the money supply increases by 10 percent
We know that goods A and B are related goods, because when the price of A increases
A. the demand curve for B will shift to the left, because A and B are complementary goods. B. the quantity of B demanded will shift along its demand curve, because A and B are complementary goods. C. the demand curve for B will shift to the right, because A and B are complementary goods. D. the demand curve for B will remain unchanged because A and B are substitute goods.