When USStock Prices Were Converted from Fractions to Decimals in 2001

question 25

Multiple Choice

When U.S.stock prices were converted from fractions to decimals in 2001 the minimum bid-ask spread charged by dealers ________.

• A) increased
• B) decreased
• C) remained the same
• D) fell at first, but then increased

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Definitions:

Aggregate Supply

The total supply of goods and services that firms in an economy are willing and able to sell at a given overall price level in a given time period.

Aggregate Expenditure

Total spending on final goods and services in an economy during a given period, usually a year.

Net National Product

The total value of goods and services produced by a country's citizens, adjusted for depreciation; it reflects the nation's overall economic productivity after wear and tear on assets.

Profit-maximizing Condition

The state or point at which a business achieves the highest level of profit with the least amount of cost, often by equating marginal cost and marginal revenue.