If the fractional reserve system did not exist,
a. the banking system could not create money
b. the money multiplier would be infinite
c. banks would loan out every penny of their deposits
d. banks would be highly susceptible to bank runs
e. the banking system would realize maximum profit
A
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Which of the following is the best example of money used as a medium of exchange?
A. Prices of products in a store in Mexico are marked in terms of U.S. dollars. B. A farmer stores $100 dollar bills in a strong box under the floor in a barn. C. A plumber unclogs a drain for a carpenter, who repairs broken steps for the plumber. D. In a prisoner of war camp cigarettes are traded for socks, candy and/or food, even by nonsmokers.
The cost of trash removal goes up, in part at least, because labor productivity in auto manufacturing goes up.
Answer the following statement true (T) or false (F)
In short-run equilibrium, the perfectly competitive firm of Figure 9-3 will produce
a.
zero units of output
b.
200 units of output
c.
275 units of output
d.
475 units of output
e.
575 units of output
Refer to the normal-form game of advertising shown below.Firm AFirm B??AdvertiseDo Not Advertise?Advertise$0,$0$175,$10?Do Not Advertise$10,$175$125,$125Suppose there is a 20 percent chance that the advertising game depicted in Figure 10-17 will end next period. What is the present value to firm B of cheating on the collusive strategy {do not advertise, do not advertise}?
A. $125 B. $10 C. $0 D. $175