Firms
A) have no influence on the circular flow in a market economy.
B) purchase resources in the product market.
C) sell resources in the factor market.
D) sell goods in the product market.
D
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One of the surprising conclusions of many of the noncooperative models of oligopoly is that firms end up better off with the noncooperative outcome than they would by cooperating with one another
Indicate whether the statement is true or false
The yield on a tax-exempt bond:
A. is called the risk-free yield. B. is equal to the yield on a U.S. 30-year bond. C. equals the taxable bond yield times one minus the tax rate. D. only applies to foreign bonds because they are exempt from U.S. income taxes.
A government is currently operating with an annual budget deficit of? $40 billion. The government has determined that every ?$10 billion reduction in the amount of bonds it issues each year would reduce the market interest rate by 0.10 percentage point.? Furthermore, it has determined that every 0.10 ?(?one-tenth?) percentage point change in the market interest rate generates a change in planned investment expenditures in the opposite direction equal to ?$5 billion. The marginal propensity to consume is 0.80. ?Finally, the government knows that to eliminate an inflationary gap and take into account the resulting change in the price? level, it must generate a net leftward shift in the aggregate demand curve equal to ?$60 billion.
Assuming that there are no direct expenditure offsets to fiscal? policy, how much should the government increase? taxes? ?$40.00 billion.?(Enter your response rounded to two decimal? places.)
For this question, assume that firms experience a reduction in sales. We would expect that this decrease in sales will cause
A) an increase in profit per unit of capital. B) a decrease in profit per unit of capital. C) no change in profit per unit of capital. D) ambiguous effects on profit per unit of capital. E) none of the above