Vault cash is equal to $8 million, deposits by depository institutions at the central bank are $2 million, the monetary base is $30 million, and bank deposits are $100 million. The money multiplier is equal to

Refer to Figure b. Kate and Alice are sisters with a very strict mother. The girls are not allowed to watch television during the day when their mother is at work. The mother comes home one day and knows at least one girl was watching the television because it is warm. She sends the girls to their separate bedrooms while she decides what to do. After giving it some thought, she decides to send a message to the naughty girls and offers them the following deal: if they both deny watching TV, they will each be grounded for 3 weeks; if one squeals on the other, but the other denies watching TV, the squealer is grounded for 2 weeks, while the denier is grounded for 10; if they both squeal, each is grounded for 6 weeks. The following payoff matrix illustrates the girls' dilemma, with Kate's

payoff shown in the upper left-hand corner of each cell and Alice's in the lower right-hand corner. What is Alice's dominant strategy?



A. Squeal

B. Deny

C. Alice does not have a dominant strategy.

D. Alice's dominant strategy depends upon what Kate does.

In a binding situation, there is no crowding out of planned investment when government spending increases or when taxes decrease.

Answer the following statement true (T) or false (F)