Exhibit 8-18 A typical firm in a perfectly competitive market
As shown in Exhibit 8-18, the perfectly competitive firm is in long-run equilibrium at a price of:
A. $100.
B. $200.
C. $300.
D. $400.
Answer: B
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Suppose the economy is at point B. If a recession in another country decreases exports, to what point might economy move in the short run?
A) It stays at point B. B) It shifts to a point such as A. C) It shifts to a point such as C. D) None of the above answers are correct because it is the SAS curve that shifts, not the AD curve.
The Department of Education noticed that for loans granted to students without any strings, the average grade point average of the students decreases dramatically over time, while the students whose loans renew only if they pass their courses tends to stay stable. This could be due to a
a. Adverse selection problem b. Moral hazard problem c. Typical college life phenomenon d. None of the above
In the long run, a reduction in the corporate profits tax may lead to ________ prices for the products of corporations and ________ prices for the products of partnerships and proprietorships.
A. lower; lower B. higher; lower C. lower; higher D. higher; higher
Refer to the information. If the real interest rate is 10 percent, the equilibrium GDP will be:Answer the following statements true (T) or false (F)
Answer the question below on the basis of the following information for a private closed economy:
A. $100.
B. $200.
C. $300.
D. $400.