The federal funds market is the market where:
a. the federal government borrows money from banks to finance the national debt.
b. the federal government lends money to commercial banks.
c. banks borrow money from other banks for short periods of time.
d. banks borrow money from the Fed for short periods of time.
e. banks borrow money from the Treasury for long periods of time.
c
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Brittany provides manicures at the only salon in town. Her marginal cost is constant at $5 per client, her fixed cost is $25 per day, and she is able to do 8 manicures per day. On a given day, half of her clients are willing to pay $15 for a manicure; half are willing to pay only $10 . If she charges $15 for those willing to pay a higher price and $10 to her other clients, then her maximum daily
profit equals a. $55 b. $100 c. $60 d. $35 e. $75
In a market economy, the government's power to coerce can:
A. undermine economic efficiency by increasing private-sector risk. B. improve economic efficiency by directing all resources to their most valued uses. C. reduce private-sector risk and increase economic efficiency. D. cause significant negative externalities.