A network externality occurs when
A) the usefulness of a good is affected by celebrities who use the good.
B) there is production cost savings from being networked with buyers.
C) the usefulness of a good is affected by how many other people use the good.
D) there is production cost savings from being networked with suppliers.
C
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If a nation does not have an absolute advantage in producing anything, it
A. has no comparative advantage either. B. will have a comparative advantage in the activity in which it is least inefficient. C. will try to get along without trade. D. will export raw materials and import finished products.
A customer of Bank A writes a $20,000 check for a new car, which the car dealer deposits in his bank, Bank B. Which of the following statements pertaining to this transaction is most true?
A. Neither Bank A's nor B's reserves will change B. Banks A's reserves will decrease by the required reserve rate times $20,000 and Banks B's reserves will increase by (1- required reserve rate) times $20,000 C. Bank B's reserves will decrease and Bank A's reserves will increase by $20,000 D. Bank A's reserves decrease by $20,000 and Bank B's reserves increase by $20,000