Dissaving occurs when
A. income is greater than saving.
B. saving is greater than the interest rate.
C. saving is greater than consumption.
D. income is less than consumption.
Answer: D
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By law, banks are required to
A) hold 100 percent of customer deposits as reserves. B) hold a fraction of demand deposits as reserves. C) hold a fraction of their reserves at the Federal Reserve bank. D) lend out no more than the amount of their required reserves.
Which of the following statements is consistent with the views of Joseph Schumpeter?
A) Research and development by competitive firms is responsible for most technological changes. B) An economy benefits from firms having market power because these firms are more likely to be able to commit funds for research and development. C) Enforcement of antitrust laws is necessary to promote competition among firms. D) A lack of competition discourages firms from developing new technologies.