Economists believe that money demand determines the price level in the long run.
Answer the following statement true (T) or false (F)
False
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The index most widely used by the government and the private sector to measure changes in the cost of living is the
A) Consumer Price Index. B) Producer Price Index. C) the chain-weighted price index. D) the GDP deflator.
Suppose consumer preference for beef starts to rise while the cost of raising beef continues to rise. In the market for beef, this would be represented by the equilibrium price ________ and the equilibrium quantity ________
A) increasing; increasing or decreasing B) increasing or decreasing; increasing C) decreasing; increasing or decreasing D) increasing or decreasing; decreasing
The joining of firms that are producing or selling a similar product is
A) a conglomerate merger. B) a horizontal merger. C) a vertical merger. D) always an illegal merger.
The buyer runs a risk of being sold a good of low quality when there is
a. a principal-agent problem. b. a moral-hazard problem. c. a problem involving hidden actions. d. a problem involving hidden characteristics.