An open-economy model is one that
a. allows for trade among nations.
b. permits free flow of individuals among nations.
c. encourages imports but not exports.
d. advocates more exports than imports.
e. Both a and b
A
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A ________ model of the household assumes that a family maximizes its happiness under a budget constraint that pools all of its income, wealth, and time
A) unitary B) secondary C) tertiary D) primary
Compared to a firm that has many small plants, a firm with a few large plants is likely to have all of the following except which one?
A) greater managerial diseconomies B) less managerial diseconomies C) fewer inputs D) greater availability of specialized capital
If the price of a DVD decreases by 50 percent, the quantity demanded increases by 75 percent. The price elasticity of demand is:
A. –1.5 and is inelastic. B. –1.5 and is elastic. C. –0.67 and is elastic. D. –0.67 and is inelastic.
Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y1. C. P3 and Y1. D. P3 and Y2.