The production possibilities frontier is the boundary between
A) those combinations of goods and services that can be produced and those that can be consumed.
B) those resources that are limited and those that are unlimited.
C) those combinations of goods and services that can be produced and those that cannot.
D) those wants that are limited and those that are unlimited.
C
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The money multiplier:
A. Is the number of deposit dollars the banking system can create from $1 of excess reserves. B. Decreases as the required reserve ratio decreases. C. Is equal to excess reserves plus required reserves. D. Is equal to the required reserve ratio times transactions deposits.
Suppose there are two factories on a river, and both need clean water for their production processes. The upstream factory takes in clean water and dumps dirty water back into the river
The downstream firm must clean up the water it gets from the river before using it. In this situation A) the private costs of the downstream factory are more than the private costs of the upstream factory, but for both factories private costs and social costs are the same. B) the social costs are greater than the private costs for the upstream firm, while the social costs are less than the private costs for the downstream firm. C) the upstream factory's private costs are less than its social costs, and its external costs are borne by the downstream factory. D) the internal costs of the upstream factory are externalized by the downstream factory, which then passes them on to its customers.