A central bank's purchase of securities made by writing checks on itself will:
A. have no impact at all on the balance sheet.
B. only change the composition of its assets.
C. decrease the size of its balance sheet.
D. increase the size of their balance sheet.
Answer: D
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Consider a monopolistically competitive industry which is in long-run equilibrium. Which of the following is TRUE?
A) All firms charge a price equal to average total cost. B) All firms charge a price equal to marginal cost. C) All firms earn positive economic profit. D) Demand, average total cost, and marginal cost all intersect.
If national laws protecting the health and safety of workers completely eliminate any and all risk, then
A) more people would be employed. B) workers in risky occupations become better off. C) compensating differentials would grow because workers could not be compensated by being given lower risk jobs. D) compensating wage differentials disappear and workers in risky occupations may be no better off.