If a consumer places a value of $15 on a particular good and if the price of the good is $17, then the
a. consumer has consumer surplus of $2 if he or she buys the good.
b. consumer does not purchase the good.
c. market is not a competitive market.
d. price of the good will fall due to market forces.
b
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An increase in the discount rate will
A) have an unclear effect on the money supply. B) not affect the money supply. C) decrease the money supply. D) increase the money supply.
An asset category that caries the highest interest rate is
A) checkable deposit accounts. B) loans. C) cash in the bank vault. D) savings deposits.
The difference in the selling and purchase prices of government securities in a typical overnight repurchase agreement is set to reflect
A) the difference in the auction price of the securities and their current market price. B) the overnight cost of funds. C) LIBOR. D) the discount on Treasury bills.
Answer the following statements true (T) or false (F)
1. A major characteristic of a monopoly is the ability of the monopolist to influence price. 2. A monopolist must produce a good for which there are no close substitutes. 3. U.S. patents grant a lifetime monopoly on an invention. 4. Public utilities are often called natural monopolies. 5. No U.S. firm has ever obtained sufficient control over raw materials to develop a monopoly or near monopoly on that basis.