When banks use the money they receive from deposits to make loans, they:
A. decrease the money supply through open market operations.
B. increase the money supply through open market operations.
C. increase the money supply through the money multiplier.
D. decrease the money supply through the money multiplier.
Ans: C. increase the money supply through the money multiplier.
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In a graph with output on the horizontal axis and total revenue on the vertical axis, what is the shape of the total revenue curve for a perfectly competitive seller?
A) U-shaped B) inverted U-shaped C) a horizontal line D) a ray from the origin
If P = Q/15 represents marginal cost for a monopolist and market supply for a competitive industry and market demand is given by Qd = 500 - 10P, the difference between the monopoly equilibrium and the competitive equilibrium is that a monopolist would produce:
A. 187.5 units of output at a price of $31.25, whereas competitive output would be 250 units at a price of $25. B. 250 units of output at a price of $25, whereas competitive output would be 300 units at a price of $20. C. 187.5 units of output at a price of $31.25 each, whereas competitive output would be 300 units at a price of $20. D. 300 units of output at a price of $20, whereas competitive output would be 187.5 units at a price of $31.25.