Which of the following statements is true?
a. A person who buys a bond always pays the face value for the bond.
b. If a corporation issues a bond and Dennis buys it, Dennis becomes one of the owners
of the corporation.
c. A stockholder of Firm X is one of the owners of Firm X.
d. The owner of the bond receives periodic payments equal to its coupon rate times the
price he paid for the bond.
Ninth National Bank holds $200 million in checkable deposits and $18,000,000 in total
reserves. With a required reserve ratio of 8 percent, how much in excess reserves is
Ninth National holding?
a. $1,440,000
b. $218,000,000
c. $17,440,000
d. $16,000,000
e. $2,000,000
Exhibit 5-3
which shows the demand and supply of a college athlete.Suppose that NCAA rules limit
the amount that the college can pay this athlete, such that their payment can not exceed
the cost of attending the college (currently, $8,000).What is the consumers’ surplus for
the college (with respect to this one athlete)?
a. area 1
b. area 2
c. area 1 + 2+ 3
d. area 1 + 2
Persons who argue that monetary and fiscal policy should be deliberately used to
smooth out the business cycle are called
a. activists.
b. disciples.
c. nonactivists.
d. controllers.
When the Fed is acting as fiscal agent for the Treasury, it will
a. buy securities from the Treasury, thereby providing the Treasury with money to pay
the government’s bills.
b. receive and process bids for Treasury securities in preparation for the Treasury’s
auction of securities.
c. serve as a lender of last resort.
d. supply the Treasury with paper money whenever the Treasury does not have enough
funds to meet its bills.
e. supervise the Treasury by examining its books.
Only a change in the price level can cause a movement from one point to another point
along a given aggregate demand curve.
a. True
b. False
Exhibit 3-4
If this is a competitive market, price and quantity will gravitate toward
a. $6 and 10 units, respectively.
b. $6 and 20 units, respectively.
c. $4 and 15 units, respectively.
d. $2 and 15 units, respectively.
If the (average) tax rate falls by 10% and as a result the tax base rises by 8%, then tax
revenues will
a. rise.
b. decline.
c. remain unchanged.
d. There is not enough information given to answer this question.
Stan Laurel and Oliver Hardy acted separately in comedy shorts for the Hal Roach
Studio for over a decade without greatly distinguishing themselves from hundreds of
other screen comedians. Then in 1927, Roach writer-director Leo McCarey tried them
out as a comedy team in one more routine short. Only then was the fantastic chemistry
between “the fiddle and the bow” realized. The rest is immortality. This story relates to
the “new growth theory” idea of
a. employee involvement.
b. rearranging.
c. exogeneity.
d. objects and ideas.
Which of the following statements is true?
a. If the actual unemployment rate is currently 5% and the natural unemployment rate is
5%, then the economy is operating at full-employment.
b. The labor force participation rate is equal to the civilian noninstitutional population
divided by the civilian labor force.
c. A discouraged worker is counted as an unemployed worker.
d. a and c
e. a, b, and c
Suppose the real exchange rate of 10 Mexican pesos to the dollar changes to 9 pesos to
the dollar. In this situation, the dollar has ________________, making Mexican goods
__________ expensive for Americans.
a. appreciated; less
b. appreciated; more
c. depreciated; less
d. depreciated; more
Exhibit 3-8
A price of $5 will result in a ___________________ in this market which will cause the
price of the product to gravitate _______________.
a. shortage; downward
b. shortage; upward
c. surplus; downward
d. surplus; upward
An unexpected decrease in aggregate demand will cause
a. a movement up the short-run Phillips curve.
b. a movement down the short-run Phillips curve.
c. an upward shift in the short-run Phillips curve.
d. a downward shift in the short-run Phillips curve.