A commercial bank's reserves are:
A. liabilities to both the commercial bank and the Federal Reserve Bank holding them.
B. liabilities to the commercial bank and assets to the Federal Reserve Bank holding them.
C. assets to both the commercial bank and the Federal Reserve Bank holding them.
D. assets to the commercial bank and liabilities to the Federal Reserve Bank holding them.
D. assets to the commercial bank and liabilities to the Federal Reserve Bank holding them.
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Prime Pharmaceuticals has developed a new asthma medicine, for which it has a patent. An inhaler can be produced at a constant marginal cost of $2/inhaler
The demand curve, marginal revenue curve, and marginal cost curve for this new asthma inhaler are in the figure above. With its patent giving it a monopoly for its new inhaler, if Prime Pharmaceuticals operates as a single-price monopoly, then there will be a deadweight loss equal to A) $24 million. B) zero. C) $16 million. D) $32 million.
Over time, state and local governments have passed regulations that limit entry into certain markets. For example, in most locations beauty shops and barber shops must obtain a license to do business
The usual justification for such licensing requirements is to better ensure that only qualified people are offering such services. Considering the efficiency implications of having more or less firms serve a particular market, and the fact that consumers can "vote with their feet" (i.e., buy from a different if they aren't satisfied), is such regulation justified from an economic perspective? Why or why not?