If at the current level of product-specific service, consumers' value at $5 and the cost of retailers to provide the services is $10, which of the following is true?
A) the profit-maximizing amount of product-specific services is being offered.
B) the profit-maximizing level of profit-maximizing services is less than the current level
C) the profit-maximizing level of profit-maximizing services is exactly double the current level
D) the profit-maximizing level of profit-maximizing services is greater than the current level
B) the profit-maximizing level of profit-maximizing services is less than the current level
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Which of the following statements is true?
A) When banks borrow from the discount window, it is an admission of trouble. B) The discount window is operated only in periods of economic expansion. C) The discount window is accessible only to well-performing banks. D) The discount window in the United States is operated by Citibank.
A borrower's willingness to sign a personal guarantee is
A) one form of the moral hazard problem. B) one form of the adverse selection problem. C) a signal of a high-quality borrower. D) a signal of a low-quality borrower.
If the actual price level is lower than the expected price level reflected in long-term contracts,
a. many firms will find production more profitable than they had expected and will increase the quantity of output supplied b. many firms will find production less profitable than they had expected and will decrease the quantity of output supplied c. many firms will find production more profitable than they had expected and will decrease the quantity of output supplied d. many firms will find production less profitable than they had expected and will increase the quantity of output supplied
The monetary transmission mechanism that assumes that money supply growth stimulates the economy primarily by encouraging investment is
A) the classical transmission mechanism. B) pre-Keynesian transmission mechanism. C) the interest-rate-based transmission mechanism. D) the post-Keynesian transmission mechanism.