When most consumers and firms reduce spending only because they expect other consumers and firms to reduce spending, and a recession results:
A. a self-correction has occurred.
B. an adverse aggregate supply shock has occurred.
C. a coordination failure has occurred.
D. a real-business downturn has occurred.
B. an adverse aggregate supply shock has occurred.
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The figure above shows the cost, demand, and marginal revenue curves for a monopoly. At an output level of ________, demand is ________
A) 20; elastic B) 50; unit elastic C) 50; elastic D) 30; unit elastic
Which of the following models results in the greatest deadweight loss, assuming a fixed number of firms with identical costs and a given demand curve?
A) Cournot B) Stackelberg C) Monopoly D) Perfect competition
An increase in both equilibrium price and quantity could be produced by a(n)
a. decrease in supply, with demand constant b. increase in supply, with demand constant c. decrease in demand, with supply constant d. increase in demand, with supply constant e. rise in resource prices
One way government can help internalize external benefits is to tax consumption that produces external benefits
Indicate whether the statement is true or false