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Explain the concepts of the short run and the long run.

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Important Questions on Money and Banking

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Other Subjects>Economics>Money and Banking>Functions of Money
For the production function \(Q = 2L^2K^2\), how would you determine the maximum possible output with given units of labour and capital? What happens if one input is zero?
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Other Subjects>Economics>Money and Banking>Functions of Money
What is meant by 'high-powered money'?
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Other Subjects>Economics>Money and Banking>Functions of Money
Explain the concept of a production function.
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Other Subjects>Economics>Money and Banking>Functions of Money
How would you find the maximum output for a firm using a production function \(Q = 5L + 2K\) if one input is zero and the other is non-zero?
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Other Subjects>Economics>Money and Banking>Functions of Money
Which of the following is NOT a function of money?
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Other Subjects>Economics>Money and Banking>Functions of Money
Why is the money supply called 'high powered' when issued by the central bank?
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Other Subjects>Economics>Money and Banking>Functions of Money
Given the production function \(Q = 5L^{ rac{1}{2}}K^{ rac{1}{2}}\), how would you calculate the maximum possible output with specific units of labour and capital?
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Other Subjects>Economics>Money and Banking>Functions of Money
What is the law of variable proportions?
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Other Subjects>Economics>Money and Banking>Functions of Money
How do commercial banks create money?
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Other Subjects>Economics>Money and Banking>Functions of Money
What is the marginal product of an input?
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Other Subjects>Economics>Money and Banking>Functions of Money
What does 'fiat money' refer to?
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Other Subjects>Economics>Money and Banking>Functions of Money
What is a major drawback of the barter system?
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Other Subjects>Economics>Money and Banking>Functions of Money
What is the 'cash reserve ratio' (CRR)?
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Other Subjects>Economics>Money and Banking>Functions of Money
What is the primary function of money?
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Other Subjects>Economics>Money and Banking>Functions of Money
What is the total product of an input?
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Other Subjects>Economics>Money and Banking>Functions of Money
What is a 'repo rate'?
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Other Subjects>Economics>Money and Banking>Functions of Money
Explain the relationship between the marginal products and the total product of an input.
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Other Subjects>Economics>Money and Banking>Functions of Money
What is the law of diminishing marginal product?
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Other Subjects>Economics>Money and Banking>Functions of Money
What is the average product of an input?
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Other Subjects>Economics>Money and Banking>Functions of Money
What is the role of the central bank in money supply?