Whenever average total cost exceeds marginal cost,
a. average total cost is rising.
b. average total cost is falling.
c. marginal cost is rising.
d. marginal cost is falling.
B
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The required reserve ratio is 10 percent and Charlie deposits $3,000 in her checking account. The bank must
A) decrease reserves by $300. B) decrease reserves by $3,000. C) increase reserves by $3,000. D) increase reserves by $300. E) not change its reserves until Charlie decides to withdraw her funds.
A long-run supply curve is flatter than a short-run supply curve because
a. firms can enter and exit a market more easily in the long run than in the short run. b. long-run supply curves are sometimes downward sloping. c. competitive firms have more control over demand in the long run. d. firms in a competitive market face identical cost structures.