The economy pictured in the figure below has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; B
B. recessionary; C
C. recessionary; A
D. expansionary; A
Answer: C
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The commercial banks in Lendland have
Reserves $400 million Loans $3,600 million Deposits $4,000 million Total assets $4,600 million The banks hold no excess reserves. a) Calculate the banks' reserve ratio. b) An immigrant arrives in Lendland with $5 million, which he deposits in a bank. How much does the immigrant's bank lend initially?
A budget deficit will be most inflationary if the aggregate
A. demand curve is very steep. B. demand curve is very flat. C. supply curve is very flat. D. supply curve is very steep.
Which of the following is true of indirect business taxes?
a. They are included in corporate profits. b. They are not included in the GDP. c. They reduce the value of total economic output thereby reducing the value of the GDP. d. They are collected by business firms that act as agents for the government. e. They are the same as personal income taxes.
There are many different models of oligopoly because:
A. firms do not maximize profits in oligopolistic competition. B. beliefs are not incorporated in oligopolistic competition and oligopoly is the most complicated type of market structure. C. beliefs are not incorporated in oligopolistic competition. D. oligopoly is the most complicated type of market structure.