Three macroeconomic factors that affect the demand for money are:
A. capital, labor, and technology.
B. the nominal interest rate, capital, and labor.
C. globalization, skill-biased technological change, and labor mobility.
D. the nominal interest rate, real income, and the price level.
Answer: D
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Which of these is NOT a potential source of inefficiency?
A) external benefits B) increasing marginal costs C) monopoly D) subsidies
For a particular good, a 10 percent increase in price causes a 3 percent decrease in quantity demanded. Which of the following statements is most likely applicable to this good?
a. The relevant time horizon is short. b. The good is a luxury. c. The market for the good is narrowly defined. d. There are many close substitutes for this good.
In 1998 the Russian government defaulted on its bonds. According to the open-economy macroeconomic model, this should have
a. increased Russian interest rates and net exports. b. reduced Russian interest rates and net exports. c. increased Russian interest rates and reduced Russian net exports. d. reduced Russian interest rates and increased Russian net exports.
If large fixed costs result in ATC falling as output increases and this occurs over the relevant range of output, this industry is a:
A. natural monopoly. B. network externality. C. profit maximizer. D. constant-cost industry.