Suppose that the demand for digital streaming devices increases significantly. Which of the following questions would a normative analysis answer?
a. Will a change in price affect the increase in demand?
b. Will the increase in demand continue?
c. How much should we increase our supply of these devices?
d. What will be the likely percent increase in demand next month?
c. How much should we increase our supply of these devices?
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Let C = 70 + 0.75y and I = 40. Assume no government or foreign sectors. Investment needs to increase by ________ to increase equilibrium output by a total of $600
A) $30 B) $150 C) $560 D) $600
If a monopoly wishes to sell more output, it must:
A. find a more cost effective way to produce its goods. B. lower the price. C. be in the economies of scale range of its ATC. D. eliminate its existing competition.
Personal and corporate income taxes are automatic stabilizers because
a. they generate approximately the same revenues during prosperity and recession b. tax rates decrease more during prosperity than during recession c. tax rates increase more during prosperity than during recession d. they take more income out of the economy during prosperity than during recession e. they take less income out of the economy during prosperity than during recession
The fiscal policy target for achieving full employment when an inflationary gap exists is known as the
A. AD excess. B. Fiscal restraint. C. AD shortfall. D. Fiscal stimulus.