Demand for inputs is a derived demand because
A. it is derived from the need for income.
B. it corresponds to the derived supply of the inputs.
C. producers want the input to produce the finished good.
D. it is downward sloping.
Answer: C
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Which of the following statements is true?
A) Cost-benefit analysis does not yield the same result as optimization analysis. B) A rational economic agent is not likely to optimize. C) Cost-benefit analysis can also be used for normative economic analysis. D) The net benefit of an option that costs $50 and provides a benefit of $100 is equal to $150.
Explain and demonstrate graphically the effects of a negative supply shock in both the short-run and long-run
What will be an ideal response?
An exclusion contract
A) is a form of entry deferral. B) gives a firm the right to be the exclusive provider of a good in a particular market. C) may not always be profitable for the incumbent. D) All of the above.
If the Fed wanted to shift to a restrictive monetary policy and reduce the money supply, it could
a. increase the interest rate paid on excess reserves encouraging banks to extend more loans. b. decrease the interest rate paid on excess reserves encouraging banks to extend more loans. c. decrease the interest rate paid on excess reserves encouraging banks to hold excess reserves rather than extend more loans. d. increase the interest rate paid on excess reserves encouraging banks to hold excess reserves rather than extend more loans.