According to the monetarists, which of the following is true?
a. Instability in the money supply is the primary cause of economic instability.
b. A reduction in the money supply will cause consumers to increase spending.
c. A reduction in the money supply will cause a proportional reduction in wages and prices, leaving output unchanged.
d. A rapid growth rate of the money supply will lead to a rapid growth rate of real GDP.
A
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Job rationing occurs when the real wage rate is
A) above the equilibrium wage rate so there is a shortage of labor. B) above the equilibrium wage rate so there is an excess supply of labor. C) equal to the equilibrium wage rate so there is no excess supply of labor. D) below the equilibrium wage rate so there is an excess supply of labor. E) Both answers A and D are correct because whenever the real wage rate is above or below the equilibrium wage rate, there is an excess supply of labor.
Refer to Table 19-20. Given the following information, calculate the rate of increase in the price level from 2015 to 2016
A) 8.6% B) 7.9% C) -7.9% D) -8.6%
Rivalry among firms would tend to be high if
a. Firms are located further from each other b. Firms are located close to one another c. There is only one firm in the market d. None of the above
Cartel members have an incentive to cheat on the cartel because:
A. the industry profit would be higher under competitive conditions. B. the cartel price is the competitive price. C. each member's output quota is too high. D. each member's MR is not equal to the cartel's MC.