In a perfectly competitive market, the market demand curve is horizontal
a. True
b. False
B
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The direct effect of an increase in the money supply is to
A) raise interest rates as people increase their saving. B) decrease aggregate demand as people anticipate future economic problems. C) increase interest rates as people anticipate higher inflation in the future. D) increase aggregate demand as people try to spend their excess money balances.
The existence of a ________ means that the interest rate on a two-year bond will exceed the average interest rate on two successive one-year bonds
A) risky asset. B) securitization premium. C) term structure. D) risk premium.
An inflation forecast developed in a Monetarist framework is likely to focus on
A) Federal Reserve policy. B) interest rate movements. C) household and business spending decisions. D) the velocity of money.
A conglomerate merger:
A. can extend the line of products sold, extend the territories in which products are sold, or combine totally unrelated products. B. is defined as a merger involving two firms that previously had a buyer-seller relationship. C. is defined as a merger involving two firms producing the same or similar products and selling them in the same geographical market. D. is illegal, per se.