Economic growth depends on
A. increases in the capital stock as a result of saving.
B. high rates of consumption.
C. high government spending.
D. low tax rates.
Answer: A
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Which of these policy targets does NOT provide a "nominal anchor?"
A) high-powered money B) the unemployment rate C) the money supply D) the inflation rate
In two-part pricing with identical consumers, a firm at least
A) charges a lump-sum fee equal to the producer surplus. B) sets unit price equal to marginal cost. C) cannot maximize profit compared to single-price monopoly pricing. D) Both A and B.
Which of the following correctly describes the spending multiplier?
A. The initial change in consumption, investment, government spending, or net exports divided by the change in equilibrium GDP. B. An initial increase in aggregate expenditures divided by the equilibrium GDP. C. An initial increase in aggregate expenditures divided by the change in equilibrium GDP. D. The ratio of the change in real GDP to an initial change in any component of aggregate expenditures.
A cartel is a group of firms that ________ to make price and output decisions.
A. implicitly colludes B. are unable C. act independently D. explicitly colludes