A firm earning economic losses should operate in the short run as long as
A) the price per unit sold is greater than the average fixed cost per unit produced.
B) the price per unit sold is greater than the average variable cost per unit produced.
C) marginal revenue is at least the price per unit sold.
D) the price per unit sold is equal to or greater than the marginal cost of production.
Answer: B
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Assuming all excess reserves are loaned out, if the reserve ratio is 1 percent, the money multiplier will be equal to
A) 1. B) 10. C) 11. D) 100.
A common definition of a recession is a time with
A) a decline in the price level. B) a decline in interest rates. C) a decrease in real GDP for two or more successive quarters. D) a decrease in real GDP for two or more successive years.
Which statement is NOT true regarding emerging markets?
A) Emerging market financial institutions have generally proven to be weaker than those in industrialized countries. B) Emerging markets are the capital markets of poorer, developing countries that have liberalized their financial system to allow private asset trade with foreigners. C) Countries with emerging markets include Brazil, Mexico, and Thailand. D) Countries with emerging markets have been unable to liberalize their financial systems to allow private trade with foreigners. E) Emerging market financial institutions contributed to the financial crisis of 1997-1999.
An unsterilized intervention in which the central bank sells foreign assets to purchase domestic currency will result in
A) higher domestic interest rates. B) lower domestic interest rates. C) an increase in the money supply. D) lower domestic interest rates and an increase in the money supply.