The fractional reserve system allows banks to create money by making loans based on the quantity of demand deposits they have
Indicate whether the statement is true or false
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A key theme fundamental to all of economics is:
A) there are limited wants. B) we are a rich country but are simply not aware of it. C) people have unlimited wants facing limited means to satisfy them. D) there are unlimited resources.
During periods of unemployment
A) the economy operates at a point inside the production possibilities curve. B) the economy operates at a point outside the production possibilities curve. C) the production possibilities curve shifts inward. D) the production possibilities curve shifts outward.
Which of the following is a good example of a firm that is not likely to be perfectly competitive?
a. Farmer Joe's wheat. b. Coyote Wile’s beef ranch. c. Captain John's salmon farm. d. Aviator Alan's nonstop airline service from Seattle to Nome.
A higher saving rate leads to faster growth because
A) more saving produces greater additions to capital per hour of labor, raising real GDP per person. B) capital would wear out faster. C) people could consume more of an economy's output. D) population growth would accelerate.