In the Keynesian cross diagram, a decrease in investment spending because companies become more pessimistic about investment profitability causes the aggregate demand function to shift down, the equilibrium level of aggregate output to ________, and
the IS curve to shift to the ________, everything else held constant. A) rise; left
B) rise; right
C) fall; left
D) fall; right
C
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Which of the following statements about a non-discriminating monopoly firm is correct?
a. It charges a price greater than its marginal cost. b. Its high prices generate inflation. c. It charges a price that maximizes its total revenues. d. As a price setter, it can ignore market demand. e. It has no incentive to produce each output level at the lowest possible cost.
Your upstairs neighbor is the first-chair violinist in the local symphony orchestra. Because you are very fond of violin music, you sit on your balcony each night to listen to her rehearse. In this case, your violin-playing neighbor is an example of a
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