If the required reserve ratio (RR) is 20 percent, the simple deposit multiplier is
A) 2.
B) 5.
C) 10.
D) 20.
Answer: B
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If an increase of $10 billion of investment results in an increase in equilibrium expenditure of $40 billion, the multiplier equals
A) $10 billion ÷ $40 billion = 0.25. B) $40 billion - $10 billion = $30 billion. C) $10 billion × $40 billion = $400 billion. D) $10 billion - $40 billion = -$30 billion. E) $40 billion ÷ $10 billion = 4.
Sonia has a BAin art history, and is currently working full-time as a waitress. The Bureau of Labor Statistics would count Sonia as:
A. employed. B. underemployed. C. unemployed. D. a discouraged worker.
The input-substitution effect associated with an increase in the wage implies that as the wage increases, a firm will substitute other inputs for the relatively expensive labor.
Answer the following statement true (T) or false (F)
One of the main differences between an oligopolistic firm and a monopolistically competitive firm is that a monopolistically competitive firm
A. Is relatively independent; an oligopoly is interdependent. B. Has high barriers to entry; an oligopoly does not. C. Has no market power; an oligopoly has some market power. D. Faces a horizontal demand curve; an oligopoly does not.