The MPC on ________ income is less than the MPC on ________ income according to ________ theory
A) transitory; permanent; Friedman's
B) transitory; permanent; Modigliani's
C) permanent; transitory; Modigliani's
D) permanent; transitory; Friedman's
D
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Graphically an increase in the short-run aggregate supply line represents a(n) ________, and a shift leftward of the long-run aggregate supply line represents a(n) ________.
A. adverse inflation shock; shock to potential output B. favorable inflation shock; shock to potential output C. shock to potential output; favorable inflation shock D. shock to potential output; adverse inflation shock
Fiat money
a. has no intrinsic value. b. is backed by gold. c. is a medium of exchange but not a unit of account. d. is any close substitute for currency such as checkable deposits.
In response to a cost-reducing technological breakthrough in the production of its product, a profit-maximizing monopolist will normally:
A. decrease the price it charges for its product. B. increase its output and practice price discrimination. C. increase price and decrease production. D. not change its level of output or price.
Refer to the data provided in Table 10.3 below to answer the following question(s).
Table 10.3 
Refer to Table 10.3. The firm currently employs 4 workers at the market wage of $480 per worker per day. If the firm wants to maximize its profits, it should
A. hire fewer workers B. hire more workers. C. shut down since it is incurring a loss. D. make no adjustments as it is already employing the profit-maximizing number of workers.