The incentive structure is a
A) system of rewards and punishments that individuals consider when making decisions.
B) system determined by the federal government that gives certain states more federal funds.
C) system of infrastructure in the United States that improves commerce.
D) system of checks and balances in the government.
A
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The key concept in the new classical approach to the aggregate supply curve is
A) the impact of imperfect information on business decisions. B) the impact of changes in the price level on real balances. C) the inverse relationship between the real interest rate and desired investment spending. D) the crowding out of investment spending by government spending.
It has been argued that in the long run monopolistic competition is inefficient because
A) there are too many firms, each with excess capacity, producing too little output. B) there are few many firms, each with excess capacity, producing too much output. C) minimum average total costs are achieved but price exceeds marginal cost. D) minimum average total costs are not achieved and marginal cost exceeds price.
Which of the following is the best description of the risks of corporate bonds?
a. the firm declines to pay dividends b. both bankruptcy and higher market interest rates c. only bankruptcy d. lower market interest rates e. both the firm declines to pay dividends and higher market interest rates
In the short run, the profit maximizing (or minimizing) quantity of output for any firm to produce exists at that output level at which marginal revenue equals marginal cost
a. True b. False Indicate whether the statement is true or false