According to your authors, the model of perfect competition
A) is an accurate description of real-world markets.
B) obscures how plan coordination occurs in the real world.
C) explains how economic profits can exist over time.
D) explains economic losses better than economic profits.
B
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Suppose the economy is operating below potential output. If policy makers try to avoid a budget deficit by raising taxes or reducing government spending, these actions would
A) make a recession worse. B) increase inflation. C) negate the multiplier effect. D) help pull an economy out of a depression.
Evidence indicates that there's a strong relationship between money and inflation in:
A) both the short and long run B) neither the short nor the long run C) short run, but not the long run D) long run, but not the short run
The expected marginal benefit to you from purchasing a new sport utility vehicle is $20,000 . The price of the new sport utility vehicle is $22,000. a. If you are acting rationally, you will borrow $2,000 and purchase a new sport utility vehicle
b. You will not purchase the new sport utility vehicle at this time if you are acting rationally. c. If you do not purchase the new sport utility vehicle, your net loss will be $2,000. d. If you are acting rationally, you will purchase sport utility vehicles until the marginal cost of doing so falls to $20,000.
A futures contract is an agreement to buy a commodity at a specific future date, at a price set today
a. True b. False Indicate whether the statement is true or false