In a perfectly competitive market the term "price taker" applies to
A) sellers and buyers.
B) sellers but not buyers.
C) buyers but not sellers.
D) only the smallest sellers and buyers.
Answer: A) sellers and buyers.
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Suppose the actual budget deficit increases when the economy falls into a recession. This is an indication that
A) monetary policy was used during the recession. B) monetary policy was not used during the recession. C) fiscal policy was used during the recession. D) fiscal policy was not used during the recession.
The Santa Fe Spark Plug Company supplies spark plugs to automotive parts dealers. An increase in the demand for its product led Santa Fe to hire 150 new workers
Santa Fe also plans to expand the capacity of its plant but this project will take 2 years to complete. Which of the following statements is true? A) The long run for Santa Fe is longer than 1 year. B) The wages and benefits paid to the new workers are implicit costs. C) In the short run Santa Fe's variable costs increase but its fixed costs decrease. D) The short run for Santa Fe is 1 year.
Assume that the government is considering different policies to increase total expenditures in order to reduce unemployment. Which of the following would achieve this objective?
a. decreasing taxes b. increasing government spending c. increasing transfer payments d. All of the above are correct.
A bank loans Kellie's Print Shop $350,000 to remodel a building near campus to use as a new store. On their respective balance sheets, this loan is
a. an asset for the bank and a liability for Kellie's Print Shop. The loan increases the money supply.
b. an asset for the bank and a liability for Kellie's Print Shop. The loan does not increase the money supply.
c. a liability for the bank and an asset for Kellie's Print Shop. The loan increases the money supply.
d. a liability for the bank and an asset for Kellie's Print Shop. The loan does not increase the money supply.