Based on the following information, the value of the M1 measure of the money supply is ________ and the value of the M2 measure of the money supply is ________. AssetsBillions of DollarsCurrency20Demand deposits30Money market mutual funds80Travelers' checks5Savings deposits180Other checkable deposits20Small denomination time deposits110
A. $255 billion; $445 billion
B. $445 billion; $445 billion
C. $75 billion; $445 billion
D. $55 billion; $425 billion
Answer: C
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A weapons producer sells guns to two countries that are at war with each other. The guns can be produced at a constant marginal cost of $10. The demand for guns from the two countries can be represented as:
QA = 100 - 2p QB = 80 - 4p Why is the weapons producer able to price discriminate? What price will it charge to each country?
Students of microeconomic principles often say they are going to study "tonight," because the only way to pass the exam is to study some every night. When "tonight" comes, some students choose to do something else. Come exam day, these students do not do well on their exam. This observation is an example of how people
a. are inconsistent over time. b. are consistent over time. c. are mainly interested in fairness. d. are rational.
Behavioral economic policy is likely to:
A. be based on the assumption of rationality. B. take into account people's predictably irrational behavior. C. suggest no government involvement. D. assume that the way choices are presented doesn't affect the decision made.