A small economy produces only pizzas and jeans. If an economy is operating inside its production possibility frontier, which of the following statements is true?
A. it will be possible to produce more pizzas without decreasing the production of jeans.
B. the economy will be operating at a point on its production possibilities curve.
C. the economy will be operating at a point outside its production possibilities curve.
D. it will not be possible to produce more jeans or pizzas.
A. it will be possible to produce more pizzas without decreasing the production of jeans.
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In the above figure, CBL is the cost of breaking the law. If it is illegal to buy and sell, then the quantity of the good bought and sold will be
A) 100. B) 200. C) 300. D) 400.
The Depository Institutions Deregulation and Monetary Control Act of 1980
A) separated investment banks and commercial banks. B) restricted the use of ATS accounts. C) imposed restrictive usury ceilings on large agricultural loans. D) increased deposit insurance from $40,000 to $100,000.
The decline in the relative importance of transactions deposits as a source of bank funds between 1970 and 1997 can be attributed to
A) the general increase in interest rates on other types of assets. B) movements of transactions deposits to thrifts. C) the extension of unlimited check writing privileges to many non-transactions deposits. D) the increase in large-sized negotiable CDs as sources of bank funds.
Most economists agree that the economy will adjust to a recessionary gap, but the adjustment process
a. is rapid and destabilizing. b. is moderately quick, but not as rapid as necessary. c. takes place solely on the supply side. d. is very slow.