Monopolistically competitive markets and oligopolies are similar in that
A) the number of firms is identical.
B) the kinked demand curve can be used to analyze the firms' pricing decisions.
C) there is mutual interdependence amongst the firms.
D) nonprice competition is a tool used.
Answer: D
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In early 2009 the price of computer memory chips rose. In a demand and supply model, shifts in what curve(s) could have brought about the higher price?
What will be an ideal response?
Suppose that the actual money multiplier equals the maximum potential money multiplier. If the reserve ratio is 10 percent, in order for the banking system to increase deposits by $2.5 million, the Fed must
A) permit the system to have prolonged reserve deficiencies. B) sell $2.5 million of government securities to the general public. C) sell $250,000 of government securities to the general public. D) buy $250,000 of government securities from the public.