Because of the problem of second-hand smoke, if unregulated, the market for cigarettes would produce a quantity that is too ____ at a price that is too ____ when compared to the socially optimal results

A bank can safely lend only an amount equal to its excess reserves because

A) all of its reserves are now required reserves. B) borrowers will spend the proceeds of their loans, and the bank will lose all of its excess reserves. C) the excess reserves will fall to zero when the bank makes the loans. D) This is not true since a bank can safely lend an amount equal to its total reserves.

When faced with an economic loss, a competitive firm will shut down its operations in the short run

a. True b. False Indicate whether the statement is true or false