In the market for land, if the supply of land is perfectly inelastic, an increase in the demand for land will result in a(n)
A. increase in economic rent.
B. increase in the real interest rate.
C. decrease in the equilibrium price.
D. increase in the quantity supplied of land.
Answer: A
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The expected benefit of investment equals:
A. the real interest rate. B. private saving. C. the price of the capital good. D. the value of the marginal product of capital.
Both first-degree price discrimination and optimal two-part tariff pricing maximize economic surplus
Indicate whether the statement is true or false
Firms can have a high degree of monopoly power and not be a perfect monopoly if they:
A. are the single producer of a product. B. control 80 to 90 percent of the market. C. have only a small number of competitors. D. intimidate the other businesses in the market.
"Monetary policy can be described either in terms of the money supply or in terms of the interest rate.". This statement amounts to the assertion that
a. rightward shifts of the money-supply curve cannot occur if the Federal Reserve decides to target an interest rate. b. the activities of the Federal Reserve's bond traders are irrelevant if the Federal Reserve decides to target an interest rate. c. changes in monetary policy aimed at expanding aggregate demand can be described either as increasing the money supply or as increasing the interest rate. d. our analysis of monetary policy is not fundamentally altered if the Federal Reserve decides to target an interest rate.