Refer to the information provided in Figure 15.3 below to answer the question(s) that follow. 
Figure 15.3 Refer to Figure 15.3. Gwen's Country Curtains is currently manufacturing 1,000 pairs of curtains per month. This firm
A. should reduce the number of pairs of curtains it manufacturers to maximize profit.
B. should increase the number of pairs of curtains it manufacturers to maximize profit.
C. could increase profits by either increasing or decreasing the number of pairs of curtains it manufactures.
D. should continue to produce 1,000 pairs of curtains; it is already maximizing profits.
Answer: D
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Outcomes are likely to be Pareto superior if they were _____
a. approved of by a unanimous vote b. enacted by a bureaucrat c. decreed by a judge d. enacted by bipartisan legislation
To increase the federal funds rate, the Fed can:
A. buy government bonds from the public. B. decrease the discount rate. C. decrease the prime interest rate. D. sell government bonds to commercial banks.
Critics of the RBC approach argue that it's hard to find productivity shocks large enough to cause business cycles. What is the RBC counterargument to this criticism?
A. Wars and military buildups could be considered productivity shocks. B. Business cycles are often caused by unobservable productivity shocks, which aren't apparent at the time they occur. C. Business cycles are always and everywhere a monetary phenomenon. D. Business cycles could be caused by the accumulation of small productivity shocks.
Compared to a system of fixed exchange rates, currency unions are beneficial because they
A. reduce the costs of trading goods and assets. B. allow every country to have an independent monetary policy. C. restrict what countries can do with fiscal policy. D. allow exchange rates to float.