A monopolist is able to sell 5 units of output at $2.50 per unit and 6 units of output at $3.50 per unit. It will produce and sell the sixth unit if its marginal cost is:

Suppose a bank has demand deposits of $100,000 and the legal reserve requirement is 20 percent. If the bank currently has $100,000 in reserves, it could expand the money supply by as much as

a. $100,000 b. $400,000 c. $0 d. $20,000 e. $80,000

A decrease in supply means that

a. demand will increase by the same amount b. the quantity supplied increases c. the quantity supplied decreases d. at every price level, the quantity supplied decreases e. the supply curve shifts to the right