A perfectly competitive firm will maximize profits (or minimize losses) so long as price (marginal revenue) is: A) greater than marginal cost. B) greater than average fixed cost. C) greater than average total cost. D) greater than average variable cost. ANSWER D
Date: September 10th, 2020
Which of the following are reported as liabilities on a bank’s balance sheet? A) reserves B) checkable deposits C) consumer loans D) deposits with other banks ANSWER B
Date: September 10th, 2020
Cross-section data observed at several points in time are called inverted data. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
Using a change in supply and/or demand, explain the following phenomena: a. All else constant, gasoline prices are higher in summer than winter months. b. At the same time that the quality of personal computers has been increasing, the price of personal computers has been falling. ANSWER a. Demand for travel is higher in […]
Date: September 10th, 2020
“In the past five years the average price of our Chevrolets has risen about 6 percent a year, and each year we have sold 10 percent more cars than the previous year.” How can this car dealer sell more cars as the price of the cars increases? What will be an ideal response? ANSWER […]
Date: September 10th, 2020
Which of the following statements are TRUE? A) A bank’s assets are its sources of funds. B) A bank’s liabilities are its uses of funds. C) A bank’s balance sheet shows that total assets equal total liabilities plus equity capital. D) A bank’s balance sheet indicates whether or not the bank is profitable. ANSWER […]
Date: September 10th, 2020
The reserve requirement is 0.20. What is the simple deposit multiplier? A) 1 B) 5 C) 0.10 D) 100 ANSWER B
Date: September 10th, 2020
A restrictive monetary policy, all else equal, will: A) depreciate the domestic currency. B) appreciate the domestic currency. C) all of the above. D) none of the above. ANSWER B
Date: September 10th, 2020
When tax revenues are greater than government expenditures, the government has a budget A) crisis. B) deficit. C) surplus. D) revision. ANSWER C
Date: September 10th, 2020
Assume there is an increase in the price of electricity (which is the result of a decrease in the supply of electricity), and electricity and natural gas are substitutes. How would this affect the demand for natural gas, and what would happen to the equilibrium price and quantity of natural gas? ANSWER The increase […]
Date: September 10th, 2020
