Everything else held constant, if aggregate output is to the left of the LM curve, then there is an excess ________ of money which will cause the interest rate to ________
A) supply; fall
B) supply; rise
C) demand; fall
D) demand; rise
A
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Suppose the demand for peaches sold from one roadside stand in Georgia is perfectly elastic. As a result, a 7 percent increase in the price charged by the owner of this stand leads to
A) zero peaches sold by this stand. B) no change in the quantity demanded at this stand. C) a 7 percent decrease in the quantity demanded at this stand. D) a 7 percent decrease in demand at this stand. E) a virtually infinite increase in the quantity demanded at this stand.
Suppose that a monopoly is currently producing the quantity at which marginal revenue is less than marginal cost. The monopoly can increase its profit by
A) shutting down. B) lowering its price and increasing its output. C) raising its price and decreasing its output. D) lowering its price and decreasing its output. E) not changing its price and increasing its output.
Refer to Table 11-6. Alicia Gregory owns a foot massage business. She leases 4 computer-controlled massage booths, for which she pays $125 per day. She cannot increase the number machines she leases without giving the manufacturer 3 months notice
She can hire as many workers as she wants at a cost of $75 per day per worker. These are the only two inputs she uses in her business. Use this information to fill in the columns in the above table.
When borrowers who do not intend to repay are able to hide their bad credit histories, a lender's well-intentioned borrowers should
a. complain to regulatory authorities b. withdraw their loan applications c. offer more collateral in exchange for lower interest charges d. divulge still more information on their loan applications e. hope for a pooling equilibrium