If the real wage is equal to 8 widgets, and only an integer number of workers can be hired, the Gizmo company should hire
A) 2 workers.
B) 3 workers.
C) 4 workers.
D) 5 workers.
A
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The Fed purchases $1 million of U.S. government securities from First Bank. The desired reserve ratio is 10 percent, the currency drain ratio is zero, and banks loan all excess reserves
The Fed's purchase increases First Bank's excess reserves by how much? A) $900,000 B) $1,000,000 C) $1,100,000 D) $10,000,000 E) $100,000
Suppose a bank wants a 5% real return on its loans, and contemplates a 1% annual inflation rate. The bank should therefore charge a nominal interest rate of
A) 1%. B) 4%. C) 5%. D) 6%.
In the above table, the private sector has a
A) surplus of $300 billion. B) deficit of $300 billion. C) deficit of $200 billion. D) deficit of $400 billion.
The above figure shows the market for apples. If apple farmers convince the government to set a minimum price of $4 per pound, then
A) 100 pounds of apples will be sold at $4. B) no apples will be supplied. C) no apples will be demanded. D) None of the above.