To close a recessionary gap, the Federal Reserve must ________ real interest rates by ________ the money supply.
A. increase; decreasing
B. decrease; increasing
C. increase; increasing
D. decrease; decreasing
Answer: B
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In the Monetarists' view, a one-time increase in the price level results from a(n)
A) technological improvement. B) increase in the labor force. C) supply shock. D) interest-rate increase.
Which of the following statements is true?
a. The proper scope of antitrust laws is well defined and definite. b. Antitrust laws focus on granting certain firms the option to form a cartel. c. Policymakers have the difficult task of determining whether some firms' decisions have legitimate purposes even though they appear anti-competitive. d. There is always a need for policymakers to try to limit a firm's pricing power, regardless of whether the firm's market is competitive, a monopoly, or an oligopoly.
Most economists believe that classical theory describes the world
a. in the short run. b. in the long run. c. in both the short run and the long run. d. in neither the short run nor the long run.
Assume Robbie's Robots operates in a perfectly competitive market producing 3,000 robots per day. At this output level, the selling price is $800 per robot and the marginal cost is $625 per robot. It follows that producing one more robot will cause this firm's
A. profits to remain unchanged. B. total cost to decrease. C. profits to increase. D. profits to decrease.