When analyzing a problem, an economist will attempt to
A. minimize the total cost of an action.
B. maximize the net benefit of an action, and this occurs where the marginal benefit equals the marginal cost.
C. maximize the total benefit of an action.
D. maximize the net benefit of an action, and this occurs where the average benefit equals the average cost.
Answer: B
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Refer to the figure below.________ inflation will eventually move the economy pictured in the diagram from short-run equilibrium at point ________ to long-run equilibrium at point ________, 
A. Rising; B; C B. Falling; A; C C. Falling; A; B D. Rising; A; C
Reserve requirements are set by
A) the Secretary of Treasury. B) the President. C) Congress. D) the Fed.
Which of the following factors can contribute to a further reduction in the money supply in addition to a massive withdrawal of cash from banks?
A. Bank purchases of Treasury bonds from the Fed B. Bank sales of government bonds to meet liquidity demands C. Banks expand the approval and granting of loans D. A decrease in the required reserve ratio
The flexibility of a firm's techniques of production is an important determinant of its costs.
Answer the following statement true (T) or false (F)