The efficient markets theory of stock prices, says that new information
a. is quickly and completely incorporated into stock prices
b. is incorporated into stock prices only when discovered by fundamental analysis
c. causes stock prices to increase
d. has little impact on stock prices
e. is incorporated into stock prices with a time lag of a few days
A
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If Happy Avocados, a ready-made guacamole manufacturer, purchases an avocado farm, this is an example of ________.
A) outsourcing B) backward integration C) divestiture D) forward integration
An inflationary gap is the amount by which
A) total planned production exceeds total planned real expenditures in the long run. B) the short-run equilibrium level of nominal GDP is above the short-run level of real GDP. C) the short-run equilibrium level of nominal GDP is below the short-run level of real GDP. D) the short-run equilibrium level of real GDP is above the full-employment level of real GDP.
Consumers buy less of a good as its price increases because:
a. production costs have risen. b. substitute goods are now relatively cheaper. c. the income of consumers has effectively risen. d. the higher price will make the good more valuable to each consumer.
A graph showing all the combinations of capital and labor that can be used to produce a given amount of output is a(n)
A. production function. B. isoquant. C. indifference curve. D. isocost line.