Which of the following statements about an entrepreneur is true?
A) purchases other factors of production in the output market
B) develops the vision for the firm and funds the producing unit
C) sells his entrepreneurial services in the output market
D) does not face personal risk
Answer: B
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When aggregate planned expenditure exceeds real GDP, there are unplanned ________ in inventories, and firms ________ production, so that real GDP ________
A) increases; increase; increases B) increases; decrease; decreases C) decreases; decrease; decreases D) decreases; decrease; increases E) decreases; increase; increases
In its effort to maximize economic profit, a firm characterized as a price setter must determine:
A) only the price it should charge. B) only the quantity it should produce. C) both the price it should charge and the quantity it should produce. D) neither the price it should charge and the quantity it should produce as these are both determined by forces beyond the firm's control.
When the U.S. minimum wage was first passed in 1938, only 56% of workers were employed in covered firms. The incomplete coverage suggests that
A) the partial equilibrium ignores the movement of workers from uncovered sectors to covered sectors. B) the decrease in employment is higher in general-equilibrium analysis. C) the general-equilibrium analysis predicts the wage in uncovered sectors will fall. D) all the workers will be worse off in both general- and partial-equilibrium analysis.
The selling of a good or service abroad at a price below what is charged in the home market or below the cost of production is referred to as
A) recycling. B) a quota. C) dumping. D) a tariff.