A monopolist's supply of a good is
A. independent of the monopolist's demand curve.
B. given by the portion of the monopolist's marginal cost curve that lies above the average variable cost curve.
C. given by the portion of the monopolist's average variable cost curve that lies above the marginal cost curve.
D. dependent on the monopolist's demand curve and its marginal cost curve.
Answer: D
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As an economy grows,
A) its PPF does not shift; instead, the production point moves from inside the PPF to be closer to the PPF. B) the opportunity cost of production will approach 0. C) it can eliminate scarcity. D) its PPF shifts outward. E) the opportunity cost of production will increase.
Macland’s government passed a law that requires businesses to give a year’s notice to any worker they want to fire and then to pay unemployment benefits for 6 months at the fired worker’s full salary. What will be the effect on the unemployment rate?
a. It will decrease as employers hire fewer workers. b. It will decrease as more people are willing to work. c. It will increase as employers hire fewer workers. d. It will have no effect on the unemployment rate.
A decrease in supply will cause the smallest increase in price when
a. both supply and demand are inelastic. b. demand is elastic and supply is inelastic. c. both supply and demand are elastic. d. demand is inelastic and supply is elastic.
When the Fed uses contractionary policy
A) the price level rises higher than it would if the Fed did not pursue policy. B) the price level rises less than it would if the Fed did not pursue policy. C) it does not change the price level. D) it causes inflation.