Suppose that monetary neutrality and the Fisher effect both hold. An increase in the money supply growth rate increases
a. the inflation rate and nominal interest rates.
b. the inflation rate, but not nominal interest rates.
c. nominal interest rates, but not the inflation rate.
d. neither the inflation rate nor nominal interest rates.
a
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If the reserve requirement is 15 percent and a customer makes a new cash deposit of $50,000, how much new excess reserves are created?
a. $7,500 b. $33,000 c. $67,500 d. $42,500
Which of the following is TRUE for the perfectly competitive firm?
A) Price and MR are always equal. B) AR is less than price. C) AR is more than price. D) Price elasticity of demand is equal to 1.
The output level at which a firm's long-run average total cost is minimized is known as its
a. profit-maximizing output level b. long-run marginal cost c. minimum efficient scale d. revenue maximization level e. equilibrium cost structure
When a price ceiling is set below the equilibrium price, quantity demanded will exceed quantity supplied resulting in
a. excess demand or shortages. b. excess supply or surpluses. c. equilibrium prices. d. price controls.