How do economies of scale contribute to the development of an oligopoly?
A. Economies of scale make small-scale producers inefficient.
B. Economies of scale make it legally difficult for new firms to enter.
C. Economies of scale are guaranteed when a patent is granted.
D. Economies of scale are based on control of a key resource, without which other firms cannot enter an industry.
Answer: A
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A diagram is a good example of a(n)
A. hypothesis. B. abstraction. C. theory. D. concept. E. instrumentation.
From a macroeconomic perspective, the problem of low household saving has probably been overstated because:
A. household saving represents a smaller share of national saving than does public saving. B. it is national saving, not household saving, that allows an economy to accumulate new capital. C. household saving is not related at all to an economy's ability to accumulate new capital. D. household saving has been increasing steadily over the last three decades.
In the money market, if the interest rate exceeds the equilibrium interest, there is a surplus of money. How is the surplus eliminated?
A) People buy bonds to rid themselves of the surplus money, bidding up their price and pushing interest rates down. B) Banks will lend out the surplus, lowering interest rates. C) The Federal Reserve will destroy currency, reducing the quantity of money. D) The high interest rate increases the demand for money, eliminating the surplus.
The higher the interest rate paid on certificates of deposit and other nontransaction deposits, other things being equal, the less people would be expected to hold in demand deposits
a. True b. False Indicate whether the statement is true or false