Refer to Figure b. Suppose consumers choose to consume water in two different states, sunny weather, WS and during a hurricane, WH. As the consumer moves from point A to B along the indifference curve, the variability of consumption:
A. decreases.
B. increases.
C. remains constant.
D. increases for one good, but decreases for the other.
B. increases.
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Based on the figure below. Starting from long-run equilibrium at point C, a decrease in government spending that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at__ creating _____gap.
A. B; no output B. D; an expansionary C. B; recessionary D. D; a recessionary
Cheap talk works at placing workers in the right job as long as
A) the interests of the worker and the firm coincide. B) all workers want the most demanding jobs regardless of their abilities. C) workers have different ability levels that are unknown to firms. D) firms are not profit maximizers.
Compared to the quantity produced under perfect completion, what does the monopolist produce?
a. The same amount as the perfect competition quantity b. More than the perfect competition quantity c. Less than the perfect competition quantity d. Either more or less than the perfect competition quantity
Which of the following is true of the production function? a. The production function of a normal good has a constant slope. b. The production function of a luxury good is a horizontal line. c. Generally, a production function has a negative slope
d. Generally, a production function has a variable slope.