Refer to the information provided in Table 8.6 below to answer the question(s) that follow.
Table 8.6
Refer to Table 8.6. If the firm is in a perfectly competitive industry with a market price of $15 per unit, the firm will produce ________ units and earn a profit of ________.
A. four; $10
B. five; $15
C. four; -$10
D. three; $10
Answer: C
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Taxes on specific goods are a method to reduce negative externalities of polluting firms.
Answer the following statement true (T) or false (F)
Under fractional reserve banking system, banks
A. hold more reserves than deposits. B. generally lend out majority of the funds deposited. C. cause the money supply to fall by lending out reserves. D. None of the above is correct.
Based on the information in the table, what quantity of reserves would the Federal Reserve have had to inject into the economy in 1932 to prevent the money supply from falling, given that the public increased the amount of currency it held and that banks increased the reserve-deposit ratio? Currency held by public(in billions)Reserve-deposit ratioBank reserves (in billions)Money supply (in billions)December 1931$4.590.095$3.11$37.3December 1932$4.820.109$3.18$34.0
A. $0.30 billion B. $0.66 billion C. $3.54 billion D. $0.89 billion
Which one of the following is a key to economic development?
A. the removal of property rights B. an educated population C. the preservation of natural resources as means of production D. a high level of protection against imported products