Normative economics seeks to:
A. objectively explain how the economy functions.
B. objectively explain economic problems such as inflation and unemployment.
C. determine the most appropriate economic goals for a society.
D. determine how government policies affect the economy.
Answer: C
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At an output level of 100, a monopolist faces MC = 15 and MR = 17. At output level q = 101, the monopolist faces MC = 16 and MR = 15. To maximize profits, the firm
A) should produce 100 units. B) should produce 101 units. C) The firm cannot maximize profits. D) The firm is not a monopoly.
With the passage of time as the availability of an exhaustible resource declines, the cost of extraction of the resource increases
a. True b. False Indicate whether the statement is true or false
What is the political business cycle and how does it relate to whether the central bank should have discretion or use a rule?
Refer to the above diagram. When output decreases from Q1 and the price level increases from P1, then this change will:
A. be caused by a shift in the aggregate supply curve from AS1 to AS3. B. result in a movement along the aggregate demand curve from e2 to e1. C. be caused by a shift in the aggregate supply curve from AS2 to AS1. D. result in a movement along the aggregate demand curve from e1 to e2.