A government policy deemed to be "temporary" indicates:
A) only long-run expectations are unchanged.
B) only expected exchange rates are unchanged.
C) only prices are not flexible in the short run.
D) there are sticky prices, fixed expected exchange rates, and constant long-run expectations.
Answer: D) there are sticky prices, fixed expected exchange rates, and constant long-run expectations.
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In the above figure, what will be the output level produced if average cost pricing is used?
A) 1,200 B) 900 C) 700 D) somewhere between 900 and 1,200
Saccharin and aspartame are both low-calorie substitutes for sugar. If saccharin is found to cause cancer,
a. the price of aspartame will increase b. the price of sugar will decrease c. the price of saccharin will increase d. the demand curves for aspartame and sugar will shift leftward e. aspartame and sugar will be complements
After a corporate merger, Rebecca Jalamid became the CEO of a monopoly firm. She was surprised to learn that one benefit of being a monopoly was that her company
a. could charge as high a price as desired b. was in a good position to capture the fruits of any innovation c. received increased scrutiny from government regulators d. started to attract potential competitors motivated to get a share of the economic profits of Rebecca's company e. contributed to the deadweight loss in the economy
Reserves of member banks appear on the Fed's balance sheet as liabilities
a. True b. False Indicate whether the statement is true or false