The money multiplier will be
a. larger if banks hold on to excess reserves but smaller if private citizens hold on to cash.
b. smaller if banks hold on to excess reserves but larger if private citizens hold on to cash.
c. smaller if either banks hold on to excess reserves or private citizens hold on to cash.
d. larger if either banks hold on to excess reserves or private citizens hold on to cash.
e. constant whether or not banks and citizens try to alter their holdings of excess reserves and cash.
C
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Assume the inflation rate falls from 4 percent to 2 percent. This means that
A) the price level has fallen. B) the price level is increasing more slowly. C) the economy is experiencing deflation. D) real GDP is decreasing.
Why does a patent stimulate research?
A) Patents give firms time to do research. B) Patents give firms the opportunity to recover research costs and thus serve as a profit motive. C) Without patents firms would not research as much. D) They don't.
The largest category of federal government spending is growing because
a. the U.S. must spend more on national defense due to the war against terror. b. the elderly population is increasing due to rising life expectancies. c. expenditures on space exploration have increased dramatically. d. expenditures on school voucher programs have increased dramatically.
Which of the following is NOT a club good?
A) cable television B) a rock concert C) a country club D) a baseball bat