The Justice Department generally challenges any merger that meets the following two conditions: (1) the post-merger HHI exceeds 1,800 and (2) the merger increases the index by more than 100 points
a. True
b. False
A
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The above figure graphs the price of a bushel of wheat and housing starts. The graph shows the variables are
A) strongly positively related. B) strongly negatively related. C) not related. D) related via an indirect relationshi
Suppose Motorland's government imposes a tax of $1.50 per gallon of gasoline sold. With the tax, the market will
A) underproduce by 0.2 million gallons of gasoline a month. B) underproduce by 0.1 million gallons of gasoline a month. C) overproduce by 0.1 million gallons of gasoline a month. D) produce the efficient quantity of gasoline.
Assume that workers have perfect information about changes in inflation. Which of the following statements is true in this context?
a. Wage rates will not adjust immediately to the price level on account of the fixed contracts. b. The aggregate supply curve of the economy will become perfectly elastic. c. The aggregate supply curve will shift to the right. d. Nominal wage rates will always exceed the real wage rate. e. The economy will continue to produce at the potential level of real GDP.
The substitution effect is
A. always greater than the income effect. B. always less than the income effect. C. sometimes less than the income effect. D. never greater than the income effect.