In a perfectly competitive market,
a. each firm faces a perfectly elastic supply curve
b. each consumer faces a perfect elastic demand curve
c. the market sums up the buying and selling preferences and determines the market price
d. the market price is determined by firms and the market quantity is determined by consumers
e. price equals marginal cost equals average total cost in the short run
C
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When the Fed purchases government securities ________ loans end up being made because ________
A) more; excess reserves in the banking system increase B) fewer; excess reserves in the banking system decrease C) more; excess reserves in the banking system decrease D) fewer; required reserves in the banking system increase but desired reserves decrease E) fewer; excess reserves in the banking system increase
An increase in the nation's capital stock will
A) shift the PPF outward. B) cause a movement along the PPF up and to the left. C) cause a movement along the PPF down and to the right. D) move the nation from producing within the PPF to producing at a point closer to the PPF.