Define microeconomics
What will be an ideal response?
Microeconomics is the study of how households and firms make choices, how they interact in markets, and how the government attempts to influence their choices.
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Use the following graph to answer the next question.
In the figure, AD1 and AS1 represent the original aggregate supply and demand curves. If Q1 is full-employment output, then AD2 and AS1 represent a(n) ________.
A. full-employment B. price stability C. expansion D. recession
The benevolent social planner wants to extract the ________ the limited resources we have been given, and her objective is to ________ the size of the economic pie
A) greatest amount of happiness from; minimize B) greatest amount of happiness from; maximize C) least productive of; minimize D) least productive of; maximize
Happy Bagels sells its bagels for $6 each and the firm has a constant marginal cost of $4 per bagel, which is equal to its (constant) average total cost. If Happy Bagels does not sell a bagel the day it is produced, the bagel is sold as day-old for $2. If Happy Bagels is currently holding 50 bagels in inventory and the probability that Happy Bagels will sell 50 bagels or more is 0.50, which of
the following statements is true? A) Happy Bagels is holding the profit-maximizing, optimal level of inventory. B) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to increase its inventory. C) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to decrease its inventory. D) To obtain the profit-maximizing, optimal level of inventory, Happy Bagels needs to double its inventory.
The economy's demand for loanable funds is not
a. the same as the economy's supply of capital b. downward sloping c. the sum of all individual firms' demands at every interest rate d. the sum of all the firms' marginal revenue product of capital curves e. a function of the rate of interest