Which of the following statements best demonstrates the constraints under which individual consumers and society as a whole operate?
a. Only the individual opportunity set (or budget constraint) demonstrates the constraints under which individual consumers and society as a whole operate.
b. Only the social production possibilities frontier demonstrates the constraints under which individual consumers and society as a whole operate.
c. Neither the individual opportunity set (budget constraint) nor the social production possibilities frontier demonstrates the constraints under which individual consumers and society as a whole operate.
d. Both the individual’s opportunity set (and budget constraint) and the social production possibilities frontier show the constraints under which individual consumers and society as a whole operate.
d. Both the individual’s opportunity set (and budget constraint) and the social production possibilities frontier show the constraints under which individual consumers and society as a whole operate.
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Assume that there is an increase in perceived bankruptcy risk. As a result of this we would expect to see
a. income and interest rates to rise. b. money demand and interest rates to fall. c. money demand and interest rates to rise. d. money supply to rise and interest rates to fall.Figure 7-1
A nation’s standard of living depends on its population and labor productivity.
Answer the following statement true (T) or false (F)
Suppose Acme and Mega produce and sell identical products and face zero marginal and average cost. Below is the market demand curve for their product.
Suppose Acme and Mega decide to collude and work together as a monopolist with each firm producing half the quantity demanded by the market at the monopoly price. If Mega cheats on the agreement by reducing its price to $1 while Acme continues to comply with the collusive agreement, then Mega's economic profit will be ________.
A. $150 B. $200 C. $100 D. $75
An initial increase in investment spending will generate:
a. More of an increase in income than the initial increase because of the multiplier effect b. Less of an increase in income than the initial increase because of the multiplier effec c. Less of an increase in income than the initial increase because of the net export effect d. More of an increase in income than the initial increase because of the net export effect