Figure 14-2
If the Fed anticipates that the conditions illustrated by AD2 and SRAS in will be present in the near future, it should
a.
decrease the discount rate.
b.
reduce reserve requirements.
c.
sell U.S. treasury bonds on the open market.
d.
buy U.S. treasury bonds on the open market.
c
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The above figure shows the production possibility frontier for an economy. The point or points that are attainable and production efficient are
A) points B and C. B) points A, B, and C. C) point E. D) points A, B, C, and D. E) points A and D.
A black market is also known as a(n) ________ economy
A) open B) closed C) underground D) emerging
In order to study how changing price affects consumer decisions, we must assume all other factors, such as income and the prices of other goods are constant. This assumption is best know as
A) rationality. B) ceteris paribus. C) normative economics. D) behavioral economics.
A natural monopoly, left to itself,
a. will take over other industries b. will produce the quantity that minimizes long-run average total cost c. will produce the quantity that minimizes marginal cost d. will produce an inefficient level of output e. will charge an inefficiently low price