A perfectly competitive firm's pricing decision depends on:
a. whether the firm wants to maximize profits or not.
b. whether the firm wants to maximize sales revenue or not.
c. the firm's costs.
d. whether it wants to compete with other firms in the market or not.
e. the market supply and demand.
e
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Fiscal policy to solve short-run economic problems supports the Keynesian notion of
A) there being no government role in the economy. B) the need for autocratic rule. C) an active government role in the economy. D) the long-run nature of the economy.
In the face of gasoline prices approaching $4.00 automobile dealerships are heavily marketing their compact cars and hybrid vehicles
However, an interesting development is that many of these dealerships are offering their economy cars at MSRP (manufacturers suggested retail price) without offering discounts. What do you suppose these dealerships believe about the price elasticity of demand for these economy cars?
A tax imposed by a state or local government on retail sales of most products is
A) an excise tax. B) a sales tax. C) a consumption tax. D) a social service tax.
Use the dynamic aggregate demand and aggregate supply model and start with Year 1 in long-run macroeconomic equilibrium
For Year 2, graph aggregate demand, long-run aggregate supply, and short-run aggregate supply such that the condition of the economy will induce the Federal Reserve to conduct a contractionary monetary policy. Briefly explain the condition of the economy and what the Federal Reserve is attempting to do.