When the Fed sells government securities to banks, the sale
A) decreases banks' reserves.
B) increases the quantity of money.
C) creates more excess reserves.
D) increases banks' reserves.
E) increases the monetary base.
A
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If a lower price for good X increases the demand for good Y, the cross elasticity value for the two goods is
A) negative. B) equal to zero. C) positive and less than one. D) positive and greater than one. E) possibly negative, positive, or zero, but there is not enough information to decide.
Government savings, , is equal to
A) T - G. B) T + G. C) T = G. D) T + G - I. E) T - G = I.
The basic difference between macroeconomics and microeconomics is:
What will be an ideal response?
Suppose that during a given time period the implicit cost for a business was $1,000 and that the explicit cost was $5,000. Also suppose that the firm sold 1,000 units of its products at $5 per item. We can conclude that the firm's
A. accounting profit was $0, and economic profit was -$1,000. B. accounting profit was $5,000, and its economic profit was $0. C. accounting profit was $0, and economic profit was $1,000. D. accounting and economic profits were both $0.