A monetarist would argue that
A) small changes in M could be offset by changes in V and not cause changes in P.
B) changes in M in the short run can cause Real GDP to fall.
C) prices and wages are flexible.
D) b and c
E) a, b and c
E
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The more inelastic the demand curve, a monopoly
A) will have a smaller Lerner Index. B) will face a lower marginal cost. C) will earn less profit. D) will lose fewer sales as it raises its price.
The law of demand says that the lower the price of a good, other things constant,
a. the smaller the demand for that good b. the larger the demand for that good c. the smaller the quantity demanded of that good d. the larger the quantity demanded of that good e. the smaller the real income of consumers and the lower the quantity demanded of that good
When Thurston catches 10 fish a day, he can gather a maximum of 40 coconuts, and when he catches 20 fish a day, he can gather a maximum of 30 coconuts. If Thurston's opportunity cost of producing each good increases as he produces more of it, and he decides to catch 30 fish a day, then the maximum number of coconuts he can gather must be:
A. greater than 10. B. equal to 20. C. greater than 20. D. less than 20.
Assume there are no prospective investment projects (I) that will yield an expected rate of return (r) of 25 percent or more, but there are $5 billion of investment opportunities with an expected rate of return between 20 and 25 percent, an additional $5
billion between 15 and 20 percent, and so on. If the real interest rate is 15 percent in this economy, the aggregate amount of investment will be: A. $25. B. $20. C. $15. D. $10.