The primary goal of firms that operate in perfectly competitive markets is to
A. Maximize revenues
B. Maximize profits
C. Equate marginal revenue with average total cost.
D. None of the above are correct
B. Maximize profits
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Higher energy prices can be used to adequately explain the productivity slowdown in
A. the United States and the rest of the world. B. the United States but not the rest of the world. C. the rest of the world but not the United States. D. neither the United States nor the rest of the world.
The creation of the Social Security program had no impact on the labor force participation rate because people are not interested in working past the age of 65.
Answer the following statement true (T) or false (F)
Senator Bright, who understands economic principles, is trying to convince workers in her district that trade with other countries is beneficial. Senator Bright should argue that trade can be beneficial
a. only if it allows us to obtain things that we couldn't make for ourselves. b. because it allows specialization, which increases total output. c. to us if we can gain and the others involved in the trade lose. d. in only a limited number of circumstances because others are typically self-interested.
The CPI differs from the GDP deflator in that
a. the CPI is a price index, while the GDP deflator is an inflation index. b. substitution bias is not a problem with the CPI, but it is a problem with the GDP deflator. c. increases in the prices of foreign produced goods that are sold to U.S. consumers show up in the CPI but not in the GDP deflator. d. increases in the prices of domestically produced goods that are sold to the U.S. government show up in the CPI but not in the GDP deflator.