If Option A costs $40 and yields 20 units of output and Option B costs $50 and yields 30 units of output,
A) Option B and Option A are equally economically efficient.
B) Option B is economically efficient relative to Option A.
C) Option A is economically efficient relative to Option B.
D) It is not possible to determine which option is more economically efficient.
D
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The operation of supply and demand should be thought of as a process
A) for establishing consumer sovereignty. B) for increasing individual liberty. C) for maximizing social welfare. D) for maximizing total output. E) of mutual accommodation.
Consider a market consisting of seven firms with market shares of 40, 20, 10, 10, 8, 7, and 5 percent, respectively. Which of the following statements is true?
a. The four-firm concentration ratio would be 0.03. b. The Herfindahl index would be 1,000. c. The Herfindahl index would be 2,228. d. The Herfindahl index would be 1,500. e. The Herfindahl index would be 2,338.
Decreasing aggregate demand to eliminate an inflationary gap often creates the problem of
a. unemployment. b. increasing real GDP. c. increasing inflation. d. increasing the labor force.
Unemployment compensation is
a. part of GDP because it represents income. b. part of GDP because the recipients must have worked in the past to qualify. c. not part of GDP because it is a transfer payment. d. not part of GDP because the payments reduce business profits.