If recessions are in large part the consequence of coordination failures,
A) government must direct or control private spending to reduce instability.
B) stability cannot be achieved without the use of discretionary fiscal policy.
C) stability cannot be achieved without the use of discretionary monetary policy.
D) the economy is unlikely to respond smoothly and predictably to shifts in government policy.
D
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The price of wine has risen from $7 to $9 per bottle and the price of cheese has fallen from $6 to $5 per pound, while Anne's income has stayed fixed at $46 per week. Since the price changes, Anne has been buying 4 bottles of wine and 2 pounds of cheese per week. We can conclude that
a. Anne is indifferent about the price changes. b. Anne is worse off after the price changes. c. Anne is better off after the price changes. d. Anne may be worse off, better off, or indifferent after the price changes.
In order for you to consider steak and lobster to be perfect substitutes, their prices per pound must be identical
Indicate whether the statement is true or false
The market price in a perfectly competitive industry is $13 . A firm is considering increasing its output from 30 units to 40 units. The marginal revenue of each of these extra units equals
a. $13 b. $130 c. $390 d. $520 e. $130
A perfectly inelastic demand curve is
A. a horizontal straight line. B. an upward sloping straight line that crosses the vertical axis. C. a vertical straight line. D. a downward sloping straight line that intersects the horizontal axis at the origin.