In the basic closed-economy ISLM model, the money demand is a function of
A) output.
B) money supply.
C) interest rates.
D) both A and C.
D
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Answer the following statement(s) true (T) or false (F)
1. If each person specializes in his area of comparative advantage and then trades for the goods he wants to have, everyone will be made better off. 2. If no one in a community desires to watch television, then it would be a waste of resources for the community to produce television sets. 3. If good wines can be produced in Turkey at costs lower than in the wine exporting countries, but the local population drinks little wine, then Turkey should not produce wine. 4. Trade will never be beneficial when both parties have a comparative advantage in producing the same good. 5. If everyone had the same abilities, then no one could benefit from trade.
Government corruption reduces economic growth around the globe, most commonly through widespread cash payments or gifts to receive a government service
Indicate whether the statement is true or false
The equilibrium interest rate will change if
a. the money demand curve shifts b. there is a movement along the money demand curve c. crowding out becomes so serious that the dollar loses value d. the federal funds rate fluctuates rapidly e. Congress threatens to put a cap on interest rates
Suppose we are studying the market for electricity provision.
Suppose we are studying the market for electricity provision. Electricity provision requires costly grids and cables, thus Electricity production exhibits economies of scale in the long-run. In a given region there is only one electricity provider.
Below is the graph depicting the market for regional electricity providers:
What is the profit maximizing level of output?
What price will the firm set?
How much more output would be produced at the competitive market equilibrium?
What is the dead weight loss at the monopoly market outcome?
True/False. Electricity provision is a monopoly market because of patent protection.
True/False. The firm earns positive profit at the monopoly market outcomes.
More competing firms enter the electricity market. What will happen.