In the market in Figure 15.1:
A. social benefits are greater than private benefits.
B. the quantity provided by the market is greater than efficient.
C. when left alone, the market produces the socially optimum quantity.
D. All of these
Answer: A
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Capital is to investment as
A. a flow is to a rate. B. a flow is to a stock. C. a stock is to a flow. D. a stock is to a bond.
Suppose a bank has $100,000 in checking account deposits with no excess reserves and the required reserve ratio is 5 percent. If the Federal Reserve lowers the required reserve ratio to 3 percent, then the bank will now have excess reserves of
A) $0. B) $2,000. C) $3,000. D) $5,000.
Suppose that an increase in capital per hour worked from $15,000 to $20,000 increases real GDP per hour worked by $500
If capital per hour worked increases further to $25,000, by how much would you expect real GDP per hour worked to increase if there are diminishing returns? A) by less than $500 B) by more than $500 but less than $5,000 C) by exactly $500 D) by more than $5,000 but less than $20,000
The most essential economic problem is the existence of: a. both an increasing population and the depletion of natural resources. b. both limited economic resources and unlimited desires
c. both inflation and unemployment. d. income inequality and economic freedom.