The world's most important reserve currency is the
A. American dollar.
B. British pound.
C. German mark.
D. Japanese yen.
A. American dollar.
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Technically speaking, if price > AVC, then
a. TR > TC b. profit is positive c. TR > TVC d. profit is negative e. the firm should shut down
If the long-run Phillips curve shifts to the right, then for any given rate of money growth and inflation the economy has
a. higher unemployment and lower output. b. higher unemployment and higher output. c. lower unemployment and lower output. d. lower unemployment and higher output.
Writing in the New York Times on the technology boom of the late 1990s, Michael Lewis argues, "The sad truth, for investors, seems to be that most of the benefits of new technologies are passed right through to consumers free of charge." What does Lewis
means by the benefits of new technology being "passed right through to consumers free of charge"? A) Firms in perfect competition are price takers. Since they cannot influence price, they cannot dictate who benefits from new technologies, even if the benefits of new technology are being "passed right through to consumers free of charge." B) In perfect competition, price equals marginal cost of production. In this sense, consumers receive the new technology "free of charge." C) In the long run, price equals the lowest possible average cost of production. In this sense, consumers receive the new technology "free of charge." D) In perfect competition, consumers place a value on the good equal to its marginal cost of production and since they are willing to pay the marginal valuation of the good, they are essentially receiving the new technology "free of charge."
In the long-run ISLM model and with everything else held constant, the long-run effect of an expansionary monetary policy is to
A) increase real output and the interest rate. B) not change either real output or the interest rate. C) increase real output and leave the interest rate unchanged. D) increase the interest rate and leave real output unchanged.