The deadweight loss caused by the monopoly market structure is equal to the loss of total surplus resulting from the good being sold by a monopolist rather than in a competitive market
a. True
b. False
Indicate whether the statement is true or false
True
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Assume the economy is in short-run equilibrium at a real GDP below its potential real GDP. According to Keynesian theory, which of the following policies should be followed?
a. The Federal Reserve should increase the money supply. b. All of the answers are correct. c. The federal government should do nothing because the economy will self correct to potential real GDP. d. The federal government should increase spending.
Answer the following statement true (T) or false (F)
1) Demand is the active and supply the passive determinant of land rent. 2) Different rents on land reflect differences in the marginal revenue product of land. 3) The free-land era of U.S. history reflected a situation in which the quantity of land available at a zero price exceeded the quantity of land demanded. 4) Rent performs an incentive function, but no rationing function. 5) The interest rate is the price paid for the use of money.
The capture theory of regulation holds that regulators use their influence and power to support the well being of the regulatory agency itself.
Indicate whether the statement is true or false.
After a negative demand shock, what are the expected long-run adjustments?
a. Wages rise, price level rises, and output falls back to potential b. Wages fall, price level rises, and output falls back to potential c. Wages fall, price level falls, and output increases back to potential d. Wages fall, price level rises, and output increases back to potential e. Wages rise, price level falls, and output increases back to potential