If a firm is an oligopolist, which is NOT true?
A) It must pay attention to other firms' prices.
B) It is one of a relatively small number of firms dominating its industry.
C) It can sell all the units it wants at the going market price.
D) It is engaged in a strategic game.
Answer: C
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Refer to Figure 28-2. The nonaccelerating inflation rate of unemployment, or NAIRU, is associated with which point rate in the figure above?
A) A B) B C) C D) all of the above
If the required reserve ratio is increased from .1 to .2, the demand deposit expansion multiplier
A) increases from 10 to 5. B) increases from 4 to 4.5. C) decreases from 5 to 2.5. D) decreases from 10 to 5.
The key reason that the Laspeyres price index tends to overstate the impact of price changes on consumers is that it:
A) only accounts for price increases and ignore price decreases. B) measures prices two periods after the actual price changes occurred. C) ignores the possibility that consumers alter their consumption as prices change. D) All of the above are correct. E) none of the above
Suppose the banking system currently has $400 billion in reserves, the reserve requirement is 8 percent, and excess reserves amount to $5 billion. What is the level of deposits?
a. $5,000 billion b. $4,937.5 billion c. $5,062.5 billion d. $4,995 billion