A home theater system and an HD television would be considered an example of:
A) substitute goods.
B) giffen goods.
C) inferior goods.
D) complementary goods.
D
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The above figure shows a perfectly competitive firm. If the market price is more than $20 per unit, the firm
A) will definitely shut down to minimize its losses. B) will stay open to produce and will make zero economic profit. C) will stay open to produce and will incur an economic loss. D) will stay open to produce and will make an economic profit. E) might shut down but more information is needed about the fixed cost.
The equilibrium real interest rate is the rate ________
A) at which the output gap is zero B) at which the inflation rate is low C) controlled by the central bank D) all of the above E) none of the above
A farmer uses M units of machinery and L hours of labor to produce C tons of corn, with the following production function C = L0.5M0.75. This production function exhibits
A) decreasing returns to scale for all output levels B) constant returns to scale for all output levels C) increasing returns to scale for all output levels D) no clear pattern of returns to scale
A decrease in demand will cause a(n)
a. increase in supply b. decrease in supply c. increase in quantity supplied d. increase in equilibrium price e. decrease in equilibrium price