According to the Lucas supply function, ________ will have an effect on real output.
A. only announced policy changes
B. only unanticipated fiscal policy changes
C. only unanticipated monetary policy changes
D. any unanticipated policy changes
Answer: D
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The Fed's quantitative easing is to purchase ________ to affect credit spreads
A) long-term securities B) short-term securities C) both long-term and short-term securities D) private assets
The excess demand created when the government imposes a price ceiling
a. shifts the equilibrium price upward to the price ceiling level b. is the difference between the quantity demanded at the old equilibrium price and quantity supplied at the price set by the price ceiling c. is the difference between the quantity demanded at the price set by the price ceiling and quantity supplied at the old equilibrium price d. is the difference between the quantity demanded at the price set by the price ceiling and quantity supplied at the price set by the price ceiling e. is the difference between the old equilibrium price and the price set by the price ceiling
Refer to the scenario above. Suppose the cost of advertising in this industry is very high and each company will incur a cost of $3 million annually if they choose to advertise. Which of the following is true in this case?
A) Company A's best response is to advertise if Company B advertises. B) Company B's best response is to advertise irrespective of what Company A does. C) Company A's dominant strategy is to advertise. D) This game does not have a dominant strategy equilibrium.
A successful advertising campaign would likely
a. increase price elasticity of demand by stressing the uniqueness of the product b. reduce price elasticity of demand by stressing the uniqueness of the product c. reduce price elasticity of demand by informing consumers of the availability of substitutes d. not alter the demand curve e. generally make the demand curve shift inward