There has been a decrease in the demand for socks. This change can be shown graphically as a:
A. shift in the demand curve to the right.
B. shift in the demand curve to the left.
C. movement along the demand curve to the right.
D. movement along the demand curve to the left.
B. shift in the demand curve to the left.
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Is it possible in the present to produce at a point that is outside the production possibilities frontier? Why or why not? With the passage of time how might a point outside the present production possibilities frontier be possible?
What will be an ideal response?
The dominant-strategy solution implies that each firm
a. ignores the reactions of competitors b. colludes with competitors to maximize industry profits c. ignores the decisions of the other firms d. takes all potential bits of information into consideration before making a decision e. selects the optimal solution to a game
A lower domestic price level raises aggregate expenditures and, therefore, shifts the aggregate demand curve to the right
a. True b. False Indicate whether the statement is true or false
Recently, the owner of KFC Franchise decided to change how she compensated her top manager. Last year, the manager received a fixed salary of GHC50,000 and KFC made GHC110,000 in profits (excluding the manager’s compensation). She feared that her store’s performance was connected to the top manager shirking on the job and expected that changes to her top manager’s compensation structure would improve sales. Therefore, this year she decided to offer him a fixed salary of $40,000 plus 5 percent of the store’s profit. Since the change, the store is performing much better, and she forecasts profits this year to be $300,000 (again, excluding the manager’s compensation). Assuming the change of compensation is the reason for