Suppose Warren Buffet withdraws $1 million from his checking account at Chase Bank. If the required reserve ratio is 20 percent, what is the maximum change in deposits in the banking system?
A) -$5 million B) -$4 million C) -$200,000 D) $1 million E) $5 million
A
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People who reject all theories because they prefer to rely on experience
A) actually rely on unrecognized theories. B) don't know any theories and are trying to cover up their ignorance. C) tend to accomplish more but also to make more mistakes. D) tend to make fewer mistakes but also to accomplish less. E) value science more than theory.
In the Keynesian model in the long run, an increase in taxes causes the price level to ________ and the real interest rate to ________
A) fall; rise B) fall; fall C) rise; rise D) rise; fall
Generally, when there is asymmetric information
A) a lender will only lend to the government. B) a lender will only lend to well-known borrowers. C) practical solutions are devised to allow lending to take place. D) a lender will cease all lending activities.
What can be concluded about the total profit?
a. It would be greater if the cartel members raised their output.
b. It would be greater if the ATC was higher.
c. It would be shared by the cartel members.
d. It would be maximized at P* = ATC.