_______________is a type of cost-benefit decision making that compares the extra benefits to the extra cost of an action.
Fill in the blank(s) with the appropriate word(s).
Ans: marginal analysis
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Everything else held constant, a decrease in holdings of excess reserves will mean
A) a decrease in the money supply. B) an increase in the money supply. C) a decrease in checkable deposits. D) an increase in discount loans.
Suppose the consumer price index (CPI) stands at 250 this year. If the inflation rate is 10 percent, then next year's CPI will equal:
a. 250. b. 260. c. 275. d. 500.
Jen spent her weekly allowance of $110 on clothes and cosmetics. Assume that she had allocated $100 to shoes and $10 to lipsticks and is in equilibrium. What can you conclude from her purchase decisions?
a. She likes shoes ten times as much as she likes lipsticks b. Jen liked the last pair of shoes ten times as much as the last tube of lipstick c. Jen purchased hundred pairs of shoes for each tube of lipstick d. She likes lipsticks ten times as much as she likes shoes e. She purchased one pair of shoes for each tube of lipstick
What is the money multiplier?
a) A measure of the potential or maximum amount the money supply can increase when new deposits enter the system. b) A measure of the amount of excess reserves banks hold. c) A measure of the amount of total reserves banks hold. d) A measure of the maximum amount of savings that can happen when account holders deposit money in a bank account.