If individuals who sit in the back of the classroom receive lower grades on average than the rest of the class, does that mean that sitting in the back of a classroom causes one to perform poorly on exams?
a. Not necessarily. The reoccurrence of a certain relationship between two variables does not necessarily imply causation.
b. It is not possible for an economist to determine causation between variables.
c. The reoccurrence of such a relationship is sufficient evidence that sitting in the back of a classroom will lead to lower grades.
d. The reoccurrence of such a relationship is sufficient evidence that students who receive low grades prefer to keep a low profile and always sit in the back of the classroom.
a
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Refer to the graph below for the health care market. The marginal cost of health care would be greater than the marginal benefit if the quantity consumed is:
A. 100
B. 200
C. 300
D. 400
Ambassador Bank has $5 million in deposits and $750,000 in reserves, with a reserve requirement ratio of 15 percent. If the Fed lowers the reserve requirement ratio to 12 percent, Ambassador Bank’s new excess reserves could potentially expand the money supply by ______.
a. $1,000,000 b. $150,000 c. $1,250,000 d. $250,000