The self-correcting tendency of the economy means that falling inflation eventually eliminates:
A. exogenous spending.
B. recessionary gaps.
C. expansionary gaps.
D. unemployment.
Answer: B
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In the long run, a firm can vary
A) its capital but not its labor. B) its labor but not its capital. C) both its labor and its capital. D) neither its labor nor its capital.
The difference between a Nash equilibrium strategy and a dominant strategy is:
a. nothing; they are synonymous. b. the former is stable but the latter is unstable. c. the former must be a best response to all others' strategy profiles, whereas the latter need only be a best response to others' Nash equilibrium strategies. d. the former need only be a best response to others' Nash equilibrium strategies, whereas the latter must be a best response to all others' strategy profiles.
Which of the following commodities have a high short-run own-price elasticity of supply?
a. Livestock b. Petroleum c. Food crops d. Diamonds
Economists claim that measuring society's welfare as CS + PS
A) is inappropriate since ultimately everyone is a consumer. B) is valid only when the same person could be either a consumer or a producer. C) treats the gains to consumers and producers equally. D) is not commonly accepted.