Normative economic principles are concerned with how people ________ make decisions while positive economic principles are concerned with how people ________ make decisions.
A. in ordinary life; in power
B. should; do
C. do; should
D. in power; in ordinary life
Answer: B
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If an automobile manufacturer has an agreement with its air bag supplier, this is an example of a ________ agreement.
A) rightward B) vertical C) horizontal D) leftward
The CPI basket of goods represents those goods and services purchased by urban consumers because it represents:
A. over 90 percent of our population. B. over 80 percent of our population. C. 78 percent of our population. D. 60 percent of our population.
Census data indicate that, as of 2011, the top fifth of all households receive about ________ times as much income as the bottom fifth
A. sixteen B. twelve C. eight D. three
Answer the following questions true (T) or false (F)
1. In the long-run equilibrium, both the perfectly competitive firm and the monopolistically competitive firm produce the output at which MR=MC and charge a price equal to the average total cost of production. 2. Most economists believe that consumers would be better off if markets were perfectly competitive rather than monopolistically competitive. 3. An oligopolistic industry is characterized by a few large firms acting independently.