If an economy is producing a combination of goods that places it on the production possibilities curve, then it has:
A) economic growth.
B) full employment.
C) inefficiency.
D) idle factors of production.
Ans: B) full employment.
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If a firm raises funds by recruiting additional owners to invest in the firm,
A) the firm's stock price would decrease. B) the firm's financial capital would increase. C) the firm's financial capital would decrease. D) the firm's net worth would decrease.
Which of the following may not characterize an oligopoly?
A. A few firms. B. Many firms. C. Substantial market power. D. High barriers to entry.
Which of the following statements is TRUE about the difference between the public debt and the government budget deficit?
A. The public debt for this year will increase or decrease depending upon whether there is a government budget deficit or a government budget surplus. B. The public debt always increases while the government budget deficit may increase or decrease. C. There is no relationship between the public debt and the government budget deficit since one is a stock measure and the other is a flow measure. D. The public debt is a flow measure and the government budget deficit is not a flow measure.
The rate at which banks can borrow excess reserves from other banks is equal to
A) the discount rate. B) the required reserve ratio. C) the interest rate paid on reserves held with the Fed. D) none of the above.