What happens to a monopoly's revenue when it sells more units of its product?
What will be an ideal response?
The monopolist must lower its price to sell more. Two things happen when a monopolist lowers its price. First, revenue will tend to rise as the monopolist sells more units and second, revenue tend to fall because less revenue is received from each unit than the amount received at the higher price. The total effect on total revenue could be an increase, a decrease, or no change in total revenue.
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Quantitative easing is a central bank policy that attempts to stimulate the economy by possibly
A) selling treasury securities. B) making discount loans to nonfinancial corporations. C) slowly reducing the required reserve ratio. D) buying long-term securities.
What is the Phillips curve? What is the difference between the original Phillips curve and the "modern" view of the Phillips curve? What problems caused the abandonment of the ideas behind the original Phillips curve?
There is no role for government in a market capitalist economy.
a. true b. false
In the Keynesian model, which curve is vertical?
A. SRAS B. NS C. AD D. LRAS