Suppose a frost destroys much of the Florida orange crop. At the same time, suppose consumer tastes shift toward orange juice. What would we expect to happen to the equilibrium price and quantity in the market for orange juice?
a. Price will increase; quantity is ambiguous
b. Price will increase; quantity will increase
c. Price will increase; quantity will decrease
d. Price will decrease; quantity is ambiguous
e. The impact on both sides is ambiguous
a. Price will increase; quantity is ambiguous.
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Refer to Figure 4-10. With rent control, the quantity supplied is Q1. Suppose apartment owners ignore the law and rent this quantity for the highest rent they can get. What is the highest rent they can get?
A) more than R1 B) R* C) R1 D) R0
Microprudential supervision focuses on the safety and soundness of
A) individual financial institutions. B) the financial system as a whole. C) the shadow banking system. D) government credit agencies.
If the producers bear a smaller tax incidence than the buyers in a market, which of the following must be true?
A. It must be a market for inferior goods. B. It must be a market for luxury items. C. Their supply curve must be more elastic than the buyers demand curve in this market. D. Their supply curve must be less elastic than the buyers demand curve in this market.
Refer to the data. The commercial banking system has excess reserves of:
Answer the question on the basis of the following consolidated balance sheet for the commercial banking system. Assume the required reserve ratio is 30 percent. All figures are in billions.
A. $9 billion.
B. $7 billion.
C. $6.1 billion.
D. $5 billion.