If a monopolist engages in price discrimination, it is with the goal of:
a. improving goodwill with the public.
b. increasing profit.
c. lowering cost.
d. making the demand for its good less elastic.
Answer: b. increasing profit.
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Other things remaining the same, an increase in the price level
A) decreases the quantity of real GDP supplied. B) decreases aggregate supply. C) increases aggregate supply. D) increases the quantity of real GDP supplied. E) neither changes aggregate supply nor changes the quantity of real GDP supplied.
Product differentiation in monopolistically competitive markets implies that: a. firms make economic profits in the long run
b. firms will produce at the minimum of the average total cost curve in the long run. c. individual firms face downward-sloping demand curves. d. firms are certain to earn economic profits in the short run.
We can say that the potential level of real GDP is fixed because the long-run aggregate supply curve is a vertical line
a. True b. False Indicate whether the statement is true or false
According to the theory of rational expectations,
a. workers' experience tells them that government action to lower unemployment will not affect inflation b. consumers and investors generally behave so that rationally formed government attempts to stimulate aggregate demand have their desired effects c. policy goals can be achieved more easily in the short run than in the long run d. workers' wage demands include anticipated inflation e. expansionary monetary policy will lead to permanent interest rate declines