If the average total cost curve is always above the demand curve of a monopolist:
a. that monopolist will suffer economic losses
b. entry will occur, forcing the monopolist to reduce price and expand output.
c. the monopolist will earn an economic profit.
d. the monopolist must be producing inefficiently.
a
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If the amount of high-powered money were 100 and the bank reserve holding ratio was 0.25 then the maximum stock of deposits would be (assume that citizens prefer to keep 10% of their money as cash)
A) 100/0.25 times 1.1 which is 440. B) 100/0.35 which is approximately 286. C) 100/0.35 times 1.1 which is approximately 314. D) 100/0.10 which is 1000.
Refer to Figure 14.2. Other things equal, an increase in worker productivity would best be represented by a movement from
A) point A to point B. B) point B to point A. C) point C to point A. D) point C to point B.
The more liquid markets are the:
A. more people are willing to save, and the higher the amount of investment occurs. B. less people are willing to save, and the higher the amount of investment occurs. C. more people are willing to save, and the lower the amount of investment occurs. D. less people are willing to save, and the lower the amount of investment occurs.
If the government wishes to increase the level of real GDP, it might reduce:
A. Taxes B. Transfer payments C. The size of the budget deficit D. Its purchases of goods and services