The government redistributes funds via transfer payments in order to ________
A) reduce the number of private transactions
B) increase competition among domestic producers
C) finance the operation of its various departments
D) reduce inequality among the citizens
D
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Assume that a monopoly is producing at a profit-maximizing output level. If the firm's total fixed costs decrease, the firm
A) should lower its price. B) should increase its price. C) should continue to produce at the same level. D) increase its output level.
The economy's long run aggregate supply curve
a. is horizontal, indicating that the economy always reaches full employment in the long run. b. is vertical at the full-employment level of output, indicating that the price level is constant in the long run. c. is horizontal, indicating that prices are constant in the long run. d. is vertical at the full-employment level of output, indicating that the economy always reaches full employment in the long run. e. is vertical at the zero budget deficit level of output.
Which of the following illustrates government acting as a referee?
A. Taxing high income persons B. Enforcing contract provisions between buyer and seller C. Buying new weapons for defense D. Mailing checks to Social Security recipients E. Collecting data on imports and exports
If Shawn can produce more donuts in one day than Sue can produce in one day, then
a. Shawn has a comparative advantage in the production of donuts. b. Sue has a comparative advantage in the production of donuts. c. Shawn has an absolute advantage in the production of donuts. d. Sue has an absolute advantage in the production of donuts.