If a firm is producing at the kink in its demand curve and it decides to increase its price, according to the kinked demand model
A. It will not gain market share but will definitely increase profits.
B. It will lose market share to the firms that do not follow the price increase.
C. It will gain market share.
D. Its market share will not be affected.
Answer: B
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The idea that policy actions have no real effects in the short run if they are anticipated and no real effects in the long run is called the
A) adaptive proposition. B) activism proposition. C) Keynesian proposition. D) policy irrelevance proposition.
Supply and demand analysis
a. can be used to understand solutions to pollution, but not causes. b. can be used to analyze how externalities lead to environmental problems. c. cannot be used to analyze pollution, which is a physical and chemical problem. d. cannot be used to solve the pollution problem, but can be used to analyze it.
For this question, assume productivity has been increasing by 5% per year. Also assume that workers' expectations of productivity growth adjust slowly over time. For this economy, a reduction in productivity growth from 5% to 2% will most likely cause which of the following to occur?
A) an increase in the natural rate of unemployment B) a reduction in the real wage C) an increase in the markup over labor costs D) all of the above E) none of the above
Refer to the information provided in Figure 4.4 below to answer the question(s) that follow.
Figure 4.4Refer to Figure 4.4. The United States will import 2 million barrels of oil per day if a ________ per barrel tariff is levied on imported oil.
A. $25 B. $50 C. $100 D. $150