Which of the following equals the current yield on a bond?
A. (Total reserves - required reserves) × the money multiplier.
B. Annual interest payment ÷ current market price of the bond.
C. Required reserve ratio ×total deposits.
D. Total reserves - required reserves.
Answer: B
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A profit-maximizing monopolist produces an output level that is allocatively inefficient because
a. price is greater than marginal cost b. price is less than marginal cost c. marginal revenue is greater than marginal cost d. marginal revenue is less than marginal cost e. consumers wish to purchase all that is produced
The poverty line is
A. never raised or lowered. B. raised or lowered every few years. C. raised every year. D. lowered every year.
Capital flows into a country are particularly high, when:
a. Capital restrictions are minimal and the domestic stock market is not well developed. b. Capital flows only depend on relative real risk-free interest rates. c. Capital restrictions are severe and the domestic stock market is highly developed. d. Capital restrictions are minimal and the domestic stock market is highly developed. e. Capital restrictions are severe and the domestic stock market is not well developed.
When the transmission mechanism breaks down, macroeconomists call this the
A. debt ceiling. B. crowding in. C. crowding out. D. liquidity trap.