The case for government stabilization policy is made more compelling if the
a. self-correcting mechanism works very slowly.
b. self-correcting mechanism works too fast.
c. value of the multiplier is very small.
d. aggregate supply curve is very flat.
a
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Relative to the prices that would be observed in an uncontrolled market, prices charged in a black market are generally
A. lower, since sellers have trouble locating buyers. B. lower, since buyers have trouble locating sellers. C. higher, since black market sellers compensate for the risk of being caught. D. higher, since most buyers enjoy goods more if they are illegal.
If a firm finds that, at its current level of employment, VMP < W, then it has
A) reached maximum profits. B) reached minimum profits. C) not hired enough labor to maximize its profit. D) hired too much labor to maximize its profit.
The intercept of a budget line measures the
a. amount of a good that a consumer will purchase b. maximum amount of a good that a consumer could purchase, given his consumption of some other good c. maximum amount of a good that could be consumed at given prices and income d. minimum amount of a good that could be consumed at given prices and income e. minimum consumption of a good consistent with utility maximization
The short-run supply curve of the perfectly competitive firm is the firm's
a. MC curve. b. AVC curve. c. MC curve above the minimum point on the AVC curve. d. MC curve above the minimum point on the ATC curve.