The inclusion of external benefits in the decision making process determining equilibrium price and quantity leads to
A) lower priced items and increased quantity.
B) lower priced items and a decline in quantity.
C) higher priced items and increased quantity.
D) higher priced items and a decline in quantity.
Answer: A
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A textbook publisher is in monopolistic competition. The firm can sell no books at $100 a book, but for each $10 cut in price, the quantity of books it can sell increases by 20 books a day. The firm's total fixed cost is $2,400 a day
Its average variable cost and marginal cost is a constant $20 per book. What is the firm's maximum economic profit? A) zero B) $800 C) -$400 D) $1,000
Refer to Table 19-17. What is nominal GDP in 2011?
A) $3,320 B) $3,690 C) $6,360 D) $7,035
With heteroskedastic errors, the weighted least squares estimator is BLUE. You should use OLS with heteroskedasticity-robust standard errors because
A) this method is simpler. B) the exact form of the conditional variance is rarely known. C) the Gauss-Markov theorem holds. D) your spreadsheet program does not have a command for weighted least squares.
Microeconomics focuses on ____; macroeconomics concentrates on ____
a. the basic tools of analysis; the use of abstractions and models b. the economies of various countries; the decisions of individual companies c. the decisions of individual units; the behavior of entire economies d. the economic aggregates; the decisions of individual units