On the Internet you find the following offers for opening an online account. Which of them is the best offer if you have $5,000 to save for two years?
a. an interest rate of 5 percent, with the bank charging you a $50 processing fee at the time you open your account
b. an interest rate of 4 percent, with the bank giving you a $65 bonus at the time you open your account
c. an interest rate of 3.5 percent, with the bank giving you a $100 bonus to open your account
d. an interest rate of 4.5 percent, with no processing fee and no bonus
b
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Bill is a high-school dropout who lost his job in a fast food restaurant when the economy plunged into a recession. After 8 months, Bill is still looking for work. He is an example of
A) frictional unemployment. B) structural unemployment. C) cyclical unemployment. D) the natural unemployment rate.
In the mini-case on pay-for-delay
A) incumbents are attempting to delay entry of generic drugs. B) the deals incumbents made with potential entrants may be illegal. C) the deals are only profitable for approximately six months. D) All of the above.
Because of the relationship between a perfectly competitive firm's demand curve and its marginal revenue curve, the profit maximization condition for the firm can be written as
A) P = MR. B) P = AVC. C) AR = MR. D) P = MC. E) P = AC.
Assume that the required reserve ratio is 20%. What is the maximum increase in money supply for the banking system as a whole following a $10,000 increase in excess reserves?
A) $5,000 B) $10,000 C) $40,000 D) $50,000