Banks create money when they:
A. allow loans to mature.
B. accept deposits of cash.
C. buy government bonds from households.
D. sell government bonds to households.
C. buy government bonds from households.
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The dramatic increase in the standard of living since the Industrial Revolution
a. means that societies and individuals face no constraints. b. has not meant unlimited abundance for societies or persons. c. means that "opportunity cost" is a meaningless concept. d. has reduced the choices open to persons. e. has made economics less useful to persons.
A business is employing inputs such that the marginal product of labor is 40 and the marginal product of capital is 90. The price of labor is $20 and the price of capital is $30. If the business wants to minimize costs while keeping output constant, then it should:
A. Use more labor and less capital B. Use less labor and less capital C. Use less labor and more capital D. Make no change in resource use