Suppose that X and Y are substitutes. If the price of Y increases, how will this change the market equilibrium for X?
a. Equilibrium price and quantity both decline.
b. Equilibrium price declines, and equilibrium quantity rises.
c. Equilibrium price rises, and equilibrium quantity falls.
d. Equilibrium price and quantity both rise.
d
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If real GDP increases by 5 percent and the population increases by 10 percent during the same period, real GDP per capita
a. increases. b. decreases. c. remains unchanged. d. increases if prices rise.
When banks hold excess reserves the:
A. money multiplier overestimates how much money will be created in the economy. B. money multiplier underestimates how much money will be created in the economy. C. reserve ratio is not fully functioning, and should be raised. D. reserve ratio is not fully functioning, and should be lowered.