The consumer price index is designed to measure the extent to which
a. the cost of a typical bundle (market basket) of consumer goods has changed over time.
b. consumers have increased their spending over time.
c. GDP is allocated to consumers, rather than to business or government, over time.
d. prices paid by employers to resource owners have changed over time.
A
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The reason an unregulated natural monopolist will produce at an economically inefficient quantity is
A) due to the fact that the monopolist will equate marginal cost with price to determine the output level. B) due to the fact that the monopolist will equate average total cost with price to determine the output level. C) that the price does not equal the true marginal cost of producing the good. D) that the monopolist will produce a quantity greater than the minimum of the average total cost curve.
Which of the following can use economic principles to improve how they make important decisions?
A) individuals B) managers in businesses C) government policymakers D) all of the above
A production possibility frontier illustrates what ideas about economic scarcity?
A) that limits to production and consumption exist B) that tradeoffs are inevitable C) that resources must be used for production and consumption to take place D) all of the above
Forward contracts
A) are highly liquid. B) entail small information costs. C) provide little risk sharing. D) are subject to default risk.