If the ice cream industry is monopolistically competitive, then:
a. the price of ice cream equals marginal cost in equilibrium
b. the price of ice cream equals average cost in long-run equilibrium.
c. the price of ice cream is less than marginal cost in equilibrium.
d. there are significant barriers to entering the ice cream business.
b
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The traditional role of savings and loan associations has been to
A. finance business purchases of capital goods. B. purchase corporate stocks on behalf of its depositors. C. make installment loans to consumers. D. make mortgage loans on houses.
Which of the following comparisons of Q1 and Q2 is accurate?
a. Q1 is 5 percent more than Q2.
b. Q1 is equal to Q2 despite a 5 percent decrease in price.
c. Q1 is equal to Q2 despite a 5 percent increase in price.
d. Q1 is 5 percent less than Q2.
To illustrate the ultimate impact of the multiplier process when investment spending falls, we should
A. Shift the AD curve rightward once. B. Shift the AD curve leftward and then shift the AS curve leftward. C. Shift the AD curve leftward twice, once for the autonomous change and second for the multiplier effect. D. Shift the AD curve leftward and then rightward.
Economic stability refers to the condition of steady growth in national output, with ________ inflation and ________ employment of resources.
A. high; full B. negative; low C. no; no D. low; full