The principal reason why two firms would form a conglomerate merger is to
a. increase the concentration in the industry
b. reduce the concentration in the industry
c. reduce dependency on buyers and thereby have greater control over price
d. diversify assets
e. achieve monopoly control
D
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In the simple Keynesian Cross model, the equilibrium level of real disposable income is determined by: a. the real interest rate
b. prices. c. aggregate expenditures. d. aggregate supply.
A survey made by Starc Motors reveals that the attrition rate for specialized workers is very high. In order to reduce attrition and increase productivity, the CEO of Starc Motors decides to pay the workers more than what market conditions dictate. The policy adopted by this company is based on the _____
a. efficiency wage theory b. model of option pricing c. insider-outsider model d. relative wage coordination argument
In this graph, what concept could W 1 be used to demonstrate?
a. Inflationary markets often cause unemployment.
b. Establishing a minimum wage may lead to unemployment.
c. Unemployment can be resolved simply by increasing the labor supply.
d. The ideal wage maximizes the quantity of labor demanded.
Which of the following is an appropriate discretionary fiscal policy if equilibrium real GDP falls below potential real GDP?
A) an increase in government purchases B) an increase in the supply of money C) an increase in individual income taxes D) a decrease in transfer payments