According to the crude quantity theory of money, if M were increased by 20%, what would happen to V, P, and Q?
What will be an ideal response?
V and Q would remain the same. P would rise 20%.
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Refer to Common Property I. Suppose the common property becomes privately owned. The owner behaves competitively and charges people an entrance fee for the right to use the property. In this situation, how are the gains from trade divided between the owner and the users of the property?
a. The owner receives area C + D, and the users receive area A + B. b. The owner receives area C, and the users receive area D. c. The owner receives area E, and the users receive area A + B + C + D. d. The owner receives area C + D, and the users receive zero.
Evidence from a 1988 study of the market for professional basketball players
a. found no evidence of consumer-driven wage discrimination. b. found some evidence of consumer-driven wage discrimination. c. found that measurement of marginal productivity was very difficult for basketball players. d. indicated that sports with strong player associations are unlikely to experience wage discrimination.
Comparative advantage implies choosing that activity which
A) has a high opportunity cost. B) is inside the production possibilities frontier. C) has the lowest opportunity cost. D) does not demand any specialization.
Consider a firm with the following cost information: ATC = $15, AVC = $12, and MC = $14. If we know that this firm has decided to produce Q = 20 by following the rule to maximize profits or minimize losses, then the price of the output is:
A. $12. B. $14. C. $15. D. $20.