If the central bank cannot commit, then
A) the leader of the central bank wants to quit.
B) the outcome is good for the macroeconomy.
C) the central bank cannot stop itself from exploiting the Phillips curve.
D) the Phillips curve is stable.
C
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Banks earn a profit by
A) charging an interest rate on their depositors' accounts. B) making loans at a higher interest rate than the rates that they offer on their deposits. C) not paying interest on their reserves. D) making loans at a lower interest rate than the rate that they offer on their deposits. E) keeping as many reserves on hand as possible.
Suppose the government of a town of 2,000 people implements a tax on each of 5 people in a small neighborhood to raise $1,000 for a sculpture that will be placed in the common area of that 5-person neighborhood
Each of the 5 people in the small neighborhood will receive $120 in benefits from the sculpture. This tax is likely to A) generate a great deal of opposition from taxpayers. B) generate a great deal of opposition from the 5 people in the affected neighborhood. C) generate little opposition from the 5 people in the affected neighborhood. D) generate the desirable social outcome.
Which of the following is NOT a financial intermediary?
A) mutual fund B) bank C) stock exchange D) insurance company
If firms in a perfectly competitive industry are earning positive economic profits, then what will happen in the long run?
What will be an ideal response?