Best-response functions
a. can only be used to analyze games with continuous actions.
b. are always downward sloping.
c. always intersect at Nash equilibria.
d. never intersect.
c
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Which of the following goods is likely to be sold through an auction?
A) a loaf of bread from a local bakery B) the rights to drill for oil on a specified 200 acres in Texas C) an ear of corn D) a bag of flour
The new classical view of fiscal policy holds that
a. budget deficits will stimulate consumption. b. budget deficits will decrease the saving rate. c. individuals fail to recognize that debt-financing implies higher future taxes. d. individuals fully anticipate the added tax liability implied by the debt financing and will increase their saving so they can meet this obligation.
Which of the following statements describes how the economy returns to long-run equilibrium following the inflationary gap?
a. Rising input prices facilitate a shift from SRAS1 to SRAS2.
b. Actual real output increases from RGDPNR to RGDP2.
c. A temporary positive shock shifts LRAS rightward.
d. Rising demand facilitates a shift from AD1 to AD2.
The point of maximum profit for a business firm is where:
A. P = AC. B. TR = TC. C. MR = AR. D. MR = MC.