When a firm sets a price relatively low in order to increase the market share, it is referred as
A) price skimming.
B) limit pricing.
C) penetration pricing.
D) predatory pricing.
C
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Assume that seigniorage and the government's primary deficit are both zero. If the real interest rate is greater than the growth rate of real GDP, the debt-to-GDP ratio
A) will increase. B) will decrease. C) will either decrease or not change. D) will either increase or not change.
Which of the following best describes the simple spending multiplier? a. It shows the magnified change in planned aggregate spending that arises from a change in output
b. It shows the magnified change in equilibrium output demanded that arises from a change in income. c. It shows the magnified change in planned aggregate spending that arises from a change in equilibrium output. d. It shows the magnified change in equilibrium output demanded that arises from a given initial change in planned aggregate spending. e. It shows the change in planned aggregate spending that arises from a change in real output.
The reason that the local telephone company is able to engage in price discrimination between business and residential customers in providing local phone service is that:
A. it is the only provider of local (landline) telephone service. B. it must be extremely difficult, if not impossible, for one consumer to resell phone service to another. C. business and residential customers differ in their willingness to pay for phone service. D. All of these are correct.
Which of the following would cause an increase in human wealth?
A) a permanent increase in salary B) an increase in the value of one's house C) an increase in the value of one's stock portfolio D) all of the above E) none of the above