Which of the following is an example of a topic studied by microeconomists?
A) Price determination by a firm B) Interest rate determination
C) Measures to combat inflation D) National income calculations
A
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What two groups of decision makers are represented in the basic circular flow model?
A) governments and financial institutions B) lenders and borrowers C) wholesalers and retailers D) bankers and regulators E) households and firms
Rent seeking
A) is the act of obtaining special treatment by the government to create economic profit. B) is the attempt to get rent from tardy renters. C) occurs when landlords advertise for apartments and other property for rent. D) is an attempt to sell a property and capture economic profit. E) occurs when a firm charges different prices for different units of its good or service.
If Sam wants to increase her total revenue from her sales of flowers and she knows that the demand for flowers is price inelastic, she should
A) lower her price to increase the demand and shift the demand curve rightward. B) raise her price because she knows that the quantity demanded will also increase. C) raise her price because she knows that the percentage decrease in the quantity demanded will be smaller than the percentage increase in price. D) lower her price because she knows that the percentage increase in the quantity demanded will be greater than the percentage decrease in price.
An example of expansionary fiscal policy would be
A) a decrease in government spending to reduce budget deficits. B) an increase in tax collection to reduce budget deficits. C) a decrease in interest rates to help stimulate the economy. D) an increase in government spending on infrastructure to create jobs and improve the economy. E) an increase in interest rates to encourage private savings.