A vertical supply curve exhibits
A) a constant elasticity of supply.
B) a perfectly inelastic supply curve.
C) Both A and B are true.
D) None of the above.
C
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When the United States engaged in quantitative easing from 2008 to 2014, why didn't the money supply rise sharply?
A) Foreigners wanted all the new dollars created by the Federal Reserve. B) Banks held the increased monetary base as excess reserves. C) The Fed offset the increased monetary base by raising reserve requirements. D) The Fed offset the increased monetary base by buying foreign currency.
Consider a Stackelberg duopoly with the following inverse demand function: P = 100 ? 2Q1 ? 2Q2. The firms' marginal costs are identical and are given by MCi(Qi) = ciQi. Based on this information, the Stackelberg leader's marginal revenue function is:
A. MR(QF) = 100 ? QF - 0.5cF. B. MR(QL) = 50 ? 2QL - 0.5cF. C. MR(QL) = 50 ? 2QL - 0.5cL. D. MR(QF) = 100 ? 2QF - 0.5cF.