Prices have soared for parking facilities in downtown Dallas in recent months. Pressure from voters has convinced the Dallas City Council to impose a price ceiling of 5 on all parking garages and lots per day. What effect will this likely have on the market for parking spaces in Dallas? Who will gain? Who will lose?
Question 2A bank's assets consist of 500,000 in total reserves, 1,600,000 in loans, and a building worth 1,200,000 . Its liabilities and capital consist of 2,000,000 in demand deposits and 1,300,000 in capital. If the required reserve ratio is 10 percent, what is the level of the bank's excess reserves? How much could it loan out as a result?
a. 200,000; 200,000
b. 200,000; 2,000,000
c. 300,000; 300,000
d. 300,000; 3,000,000
Question 3The key feature due to which unexpected inflation decreases the unemployment rate is that:
a. expectations are formed irrationally.
b. reservation wages of workers are fixed.
c. workers behave irrationally.
d. firms are greedy.
e. government policy is time consistent.
Question 4How does the equilibrium quantity traded change when there is an increase in supply and a decrease in demand?
Question 5U.S. government bonds held by commercial banks are:
a. government assets and commercial bank assets.
b. government assets and commercial bank liabilities.
c. government liabilities and commercial bank assets.
d. government liabilities and commercial bank liabilities.
Question 6Which of the following is most likely to increase the natural rate of unemployment?
a. An increase in the age of the working population
b. A shift from service to manufacturing jobs
c. An increase in the minimum wage rate
d. A reduction in social security benefits
e. A reduction in direct taxes
Question 7Beach resorts raise their prices during the summer months and yet more people book rooms at those times. Is this a violation of the law of demand?
Question 8A decrease in the excess reserves banks want to hold, together with people taking currency out of their demand deposit accounts, would:
a. increase the money supply.
b. decrease the money supply.
c. leave the money supply unchanged.
d. have an indeterminate effect on the money supply.
Question 9The natural rate of unemployment is defined as the unemployment rate that exists in the absence of:
a. structural unemployment.
b. frictional unemployment.
c. cyclical unemployment.
d. seasonal unemployment.
e. inflation.
Question 10Serious natural disasters like hurricanes and tornadoes cause widespread and extensive damage to buildings. As a result of a natural disaster, what would you expect to happen in the market for building supplies?
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