For a perfectly competitive firm, price always equals marginal cost.
Answer the following statement true (T) or false (F)
False
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Which of the following indicates the primary mechanism by which the money supply expands?
a. The U.S. Treasury prints additional currency. b. The Fed purchases additional bonds, which increases the reserves available to the banking system. c. The public decides to hold more currency rather than checking deposits. d. The U.S. government purchases additional gold.
Suppose a country abandons a no-trade policy in favor of a free-trade policy. If, as a result, the domestic price of pistachios decreases to equal the world price of pistachios, then
a. that country becomes an exporter of pistachios. b. that country has a comparative advantage in producing pistachios. c. at the world price, the quantity of pistachios demanded in that country exceeds the quantity of pistachios supplied in that country. d. All of the above are correct.
Which of the following entities actually executes open-market operations?
a. the Board of Governors b. the New York Federal Reserve Bank c. the Federal Open Market Committee d. the Open Market Committees of the regional Federal Reserve Banks
The introduction of the euro has eliminated currency as a barrier to trade in all European countries.
a. true b. false