If the reserve ratio is 0.9, the money multiplier will be 10.
Answer the following statement true (T) or false (F)
False
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When per capita real GDP is increasing, real output is growing:
a. more rapidly than prices. b. more rapidly than population. c. less rapidly than prices. d. less rapidly than population.
An increase in wages can cause a relatively big decrease in employment when
a. product demand is inelastic b. labor demand is elastic c. there is a closed shop d. the MRP curve is inelastic e. the MRP curve shifts to the right
The Fed changes the reserve requirement sparingly because:
A. sudden changes of such a huge magnitude would have far-reaching, and sometimes undesirable, effects. B. it would cause uncertainty for banks and slow their rate of lending. C. very small changes cause very large overall changes to money supply due to the money multiplier. D. All of these are true.
The industrially advanced nations had an average per capita income in 2010 of around:
A. $50,000 per person B. $27,000 per person C. $39,000 per person D. $61,000 per person