Last year's price level was 120 and since then there has been a 5 percent inflation. This year's price level is
A) 125.
B) 126.
C) 130.
D) none of the above.
B
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Why does the Fed have imperfect control over the money supply?
A. Because the Fed does not know how much reserves will change when it buys or sells securities. B. Because of unpredictable changes in the public’s desire to hold cash and banks’ desires to hold reserves. C. Because of unpredictable changes in reserve requirements. D. Because of the secrecy of FOMC meetings, which lead to policy surprises.
When a negative externality exists, the private market produces
A) products at a low opportunity cost. B) less than the economically efficient output level. C) products at a high opportunity cost. D) more than the economically efficient output level.
In a situation where an artist is selling his own work to the galleries, the agent is
a. The artist b. The gallery c. Both of the above d. None of the above
The demand curve faced by a monopolist is the same as the marginal revenue curve
a. True b. False Indicate whether the statement is true or false