If the required reserve ratio is 15 percent, currency in circulation is $400 billion, checkable deposits are $800 billion, and excess reserves total $0.8 billion, then the M1 money multiplier is

Why do fads often lead to shortages, at least in the short term?

A. Demand increases too quickly and unexpectedly for the supply to keep up. B. Laws prevent stores from responding to excess demand in time to prevent a shortage. C. Buyers and sellers are unable to agree on a price for the good. D. Manufacturers charge such high prices for the goods that stores are unwilling to pay.

A government policy that would raise the rate of productivity growth is

A) shifting infrastructure expenditures to the private sector. B) taxing expenditures on research and development. C) reducing the government budget surplus. D) improving human capital development.