A car leasing company that expands its size by buying its competitors may run the risk of increasing production cost per unit due to:
A. diseconomies of scale.
B. economies of scale.
C. diminishing returns.
D. greater use of large-volume purchases.
Answer: A
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The table below gives the quantities and prices for 2010 and 2015 for an economy that produces just two goods: sailboats and coconuts. Quantity producedPrice 2010201520102015Sailboats1020$500$525Coconuts2,0002,400$1$2For this economy that produces just sailboats and coconuts, and with 2010 is the base year, real GDP was approximately ________ times larger in 2015 than it was in 2010.
A. 1.77 B. 2.19 C. 1.34 D. 1.65
If the currency drain ratio is 0.2 and the desired reserve ratio is 0.03, the money multiplier is
A) 5.22. B) 6.67. C) 0.76. D) 4.46. E) 3.23.
Which of the following combinations would unambiguously decrease the supply of money? a. The Fed pays a lower interest rate on bank reserves and increases the required reserve ratio
b. The Fed conducts an open market purchase of government securities and raises the discount rate. c. The Fed pays a higher interest rate on bank reserves and conducts an open market purchase of government securities. d. None of the above would unambiguously decrease the supply of money.
How is it possible for the economy to have a recessionary gap?
a. Equilibrium is at a GDP level below full employment. b. Equilibrium is at a GDP level equal to full employment. c. Equilibrium is at a GDP level above full employment. d. GDP is rising at full employment. e. GDP is falling at full employment.