A price ceiling disrupts markets because the price is set too low
Indicate whether the statement is true or false
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A car dealer sells you a car today in exchange for money in the future. This illustrates which function of money?
A) standard of deferred payment B) unit of account C) medium of exchange D) store of value
In his Liquidity Preference Framework, Keynes assumed that money has a zero rate of return; thus
A) when interest rates rise, the expected return on money falls relative to the expected return on bonds, causing the demand for money to fall. B) when interest rates rise, the expected return on money falls relative to the expected return on bonds, causing the demand for money to rise. C) when interest rates fall, the expected return on money falls relative to the expected return on bonds, causing the demand for money to fall. D) when interest rates fall, the expected return on money falls relative to the expected return on bonds, causing the demand for money to rise.
Natural monopolies have all of the following characteristics except
a. relatively high fixed cost b. relatively low average variable cost c. low levels of production d. difficulty for new firms to enter e. only one firm can produce profitably
Monopolistic competition is similar to perfect competition in that:
A. firms earn economic profits in the long run B. there are a large number of firms C. firms face downward-sloping demand curves D. both a and b E. all of the above