Which of the following need not be true of a monopoly?
a. The firm must be the only producer of the product
b. The product must have no close substitutes.
c. There must be high barriers to entry.
d. The firm must earn an economic profit in the short run.
d
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Depository institutions
A) make profit from the spread between the interest rate they pay on deposits and the interest rate they receive on loans. B) make a profit according to how much the Federal Reserve pays them. C) make their profit by charging the government for their services. D) make zero profit but receive compensation by the government because their services are so valuable.
Evidence from the time period 1960-1980 indicates that inflation in the United States resulted from
A) an employment target that was set too high. B) the government's inability to sell bonds to the Fed. C) an expansion in the money supply to finance federal government expenditures. D) the excessive sale of government bonds to the public.
A commonly-used gauge of poverty is the
a. income inequality rate. b. average income rate. c. poverty rate. d. social inequality rate.
One of the interesting findings of a survey of firm managers by Blinder et al. is that:
A) the vast majority of firms pay considerable attention to marginal costs in making decisions about how much output to produce. B) the majority of respondents suggested that fixed costs are a relatively unimportant consideration when making output decisions. C) approximately 75 percent of respondents indicated that their marginal costs of production are rising over the relevant range of output. D) a significant percentage of respondents to the survey did not appear to understand the concept of marginal cost.