The maximum increase in the money supply possible from a deposit of $D into the banking system where R is the reserve requirement is
a. (1/R)(D ? R).
b. R × D.
c. (1/R)(1 ? R)D.
d. (1/R)D.
c
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Marge buys 5 CDs and 7 DVDs. The marginal utility of the 5th CD and the marginal utility of the 7th DVD are both equal to 30 utils. Can we say that this is the optimal combination of CDs and DVDs for Marge?
A) No. We need to know her preferences for CDs and DVDs. B) No. For this to be the optimal combination, the total utility from her purchase of CDs needs to equal the total utility from her purchase of DVDs. C) No. If this was the optimal combination, the marginal utility per dollar of the 5th CD and the 7th DVD would be equal. D) Yes.
Refer to the figure above. Domestic producers gain ________ because of the tariff
A) $5 B) $62,500 C) $15 D) $125,000
According to rational expectations theory: a. a large reduction in unemployment can be achieved with a relatively small increase in inflation
b. people are not easily fooled by changes in government fiscal policy. c. inflation rates that rise 3 percentage points each year will keep unemployment below its natural rate for a sustained period of time. d. the Phillips curve will slope downward to the right, if people correctly anticipate the inflation rate.
A competitive firm is producing 500 units of output and its efficient scale is 400 units of output. Can the market in which this firm operates be in a long-run equilibrium? Briefly explain