What area on a supply and demand graph represents consumer surplus?
What will be an ideal response?
Consumer surplus is the area below the demand curve and above the market price.
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Answer the next question on the basis of the following consolidated balance sheet of the commercial banking system. Assume that the reserve requirement is 20%. All figures are in billions.Assets (billions of dollars)Liabilities & Net Worth (billions of dollars)Reserves$200Checkable deposits$1000Securities300Stock shares400Loans500 Property400 Suppose the Fed wants to increase the money supply by $1,000 billion to drive down interest rates and stimulate the economy. To accomplish this, it could lower the reserve requirement from 20% to ________.
A. 15% B. 10% C. 14% D. 12%
A traditional system solves basic economic questions by long-standing customs
a. True b. False Indicate whether the statement is true or false
When investors use borrowed funds to pay for investments, it's called:
A. leveraging. B. tulip mania. C. hedging. D. herding.
Tariffs and quotas are used to promote trade with foreign countries
Indicate whether the statement is true or false