When the Fed wants to expand the money supply through open-market operation, it
A. sells government securities to the Treasury.
B. sells government securities to member banks.
C. buys government securities from member banks.
D. buys government securities from the Treasury.
Answer: C
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The above figure shows the marginal social benefit and marginal social cost curves of doughnuts in the nation of Kaffenia. There is no external benefit
What is the marginal benefit to the citizen of Kaffenia who consumes the 100th dozen doughnuts each day? A) $10.00 per dozen B) $8.00 per dozen C) $6.00 per dozen D) $4.00 per dozen
The average total cost curve
A) is U-shaped. B) diminishes initially because average fixed costs diminish. C) increases eventually because of diminishing returns. D) All of the above answers are correct.
Rational self-interest means
A) always increasing your wealth. B) pursuing what makes you better off. C) pursuing activities that maximize income. D) always pursuing activities that are consistent with your faith.
In the short run, which factor is not relevant in profit-maximizing output decisions?
a. wage rates b. raw material costs c. mortgage costs d. energy costs e. market price