In a purely competitive market at its long-run equilibrium, which of the following is not true?
A) Price equals marginal cost, and they are equal to the lowest attainable average cost of production.
B) The marginal benefit of the last unit of the product equals the marginal cost of producing that unit.
C) The maximum willingness of buyers to pay for the last unit of the product equals the minimum acceptable price for the seller of that unit.
D) The combined amount of consumer and producer surpluses is at its minimum possible.
Ans: D) The combined amount of consumer and producer surpluses is at its minimum possible.
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A decrease in the real interest rate in the United States will cause net capital outflows to ________ and cause the dollar to ________ relative to other currencies
A) increase; appreciate B) increase; depreciate C) decrease; appreciate D) decrease; depreciate
In reality, according to the model developed in Section 15.5 of the textbook, prices of non-renewable resources have not increased continually because of
A) abundance of the resource. B) technological progress changing marginal cost. C) changing market power of producers. D) All of the above.
An increase in the population of an economy can shift the demand curves for certain goods and services to the right
a. True b. False Indicate whether the statement is true or false
Assume that the central bank purchases government securities in the open market. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the GDP Price Index and net nonreserve-related international borrowing/lending in the context of the Three-Sector-Model?
a. The GDP Price Index falls, and net nonreserve-related international borrowing/lending becomes more negative (or less positive). b. The GDP Price Index and net nonreserve-related international borrowing/lending remain the same. c. The GDP Price Index falls, and net nonreserve-related international borrowing/lending becomes more positive (or less negative). d. The GDP Price Index rises, and net nonreserve-related international borrowing/lending becomes more negative (or less positive). e. The GDP Price Index rises, and net nonreserve-related international borrowing/lending becomes more positive (or less negative).