Refer to the above data. If this economy were an open economy, the equilibrium GDP will be:
A. $650 billion
B. $600 billion
C. $550 billion
D. $500 billion
C. $550 billion
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In the above figure, Reggie's budget line rotates outward from BL1 to BL2. He initially consumes at point A. If his new consumption bundle is at point B, this implies that kiwi fruit and mangoes are
A) both lower in price. B) both inferior goods. C) neither substitutes nor complements. D) None of the above answers is correct.
In the figure above, the deadweight loss when the market is a single-price monopoly rather than perfectly competitive is the area of
A) triangle aeb. B) triangle aic. C) triangle eig. D) triangle eif.
The rate of return on bonds is lower than on stocks over time because
A) bond holders cannot diversify. B) bonds have a lower standard deviation in returns. C) stocks have less non-diversifiable risks than bonds. D) bonds are subject to more random risks than stocks.
When loans are repaid at commercial banks
A. the assets of commercial banks increase. B. money is destroyed. C. money is created. D. the net worth of commercial banks increases.