If a country's consumer price index (CPI) was 104.2 in Year 1, while the inflation rate for Year 2 was 4.89%, then the CPI in Year 2 was:
(a) 106.5;
(b) 108.5;
(c) 109.3;
(d) 111.5.
Answer: (c) 109.3;
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Which of the following is not true about excess reserves?
A. They change when the reserve requirement changes. B. They are equal to the required reserve ratio times transactions deposits. C. They are bank reserves beyond what the bank is required to hold. D. They represent the dollars an individual bank can lend.
A knitting factory worker who loses her job because the company has relocated the plant to another country is an example of _____.
(A) Cyclical unemployment (B) Frictional unemployment (C) Seasonal unemployment (D) Structural unemployment
Consider Figure 12.5. Confessing is a dominant strategy for:
A. player A but not player B. B. player B but not player A. C. both players. D. neither player.
Income elasticity of demand describes:
A. which way the demand shifts in response to a change in price. B. how much the quantity demanded changes in response to a change in consumers' incomes. C. how quickly the market will change in response to a change in consumers' incomes. D. how much the quantity demanded changes in response to a change in price.