Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential
B. expansionary; lower; potential
C. expansionary; higher; potential
D. recessionary; lower; lower
Answer: A
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Refer to the table below. If the cost per unit of advertising is constant at $475, what is the level of advertising per week that maximizes the industry joint profit?
Suppose the egg industry is made up of only the three farms above; Happy Chickens, Special Chickens, and Superior Chickens.
A) 1
B) 2
C) 3
D) 4
What is the 4-firm concentration ratio of an industry with 25 firms each having an equal market share?
a. .16. b. .24. c. .20. d. .12.
Market failure can occur even when the price signals are accurate.
Answer the following statement true (T) or false (F)
A local video store estimates its average customer's demand per year is Q = 7 ? 2P, and it knows the marginal cost of each rental is $0.5. How much should the store charge for an annual membership in order to extract the entire consumer surplus via an optimal two-part pricing strategy?
A. $9 B. $10 C. $12 D. $11