Which of the following best describes equilibrium?
A) A situation where the government intervenes to allocate resources
B) A situation where only one individual or firm takes an optimum decision
C) A situation where no economic agent would benefit by changing his or her behavior
D) A situation where economic agents do not optimize as they do not have perfect information
C
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To maintain profit, entrepreneurs must:
A. maintain only one product. B. continually improve their products. C. eliminate all competition. D. keep raising prices.
The demand for automobiles fell when gasoline prices increased. Which of the following is likely to happen in this case, assuming all else equal?
A) The labor demand curve of automobile companies will shift to the left. B) The labor demand curve of automobile companies will shift to the right. C) The supply of labor to the automobile industry will decrease. D) The supply of labor to the automobile industry will increase.
The figure above shows the marginal social cost curve of generating electricity and the marginal private cost curve. The marginal external cost when 200 billion kilowatt hours are produced is
A) 0¢ per kilowatt. B) 10¢ per kilowatt. C) 20¢ per kilowatt. D) 15¢ per kilowatt. E) 5¢ per kilowatt.
The current international financial system is a managed float exchange rate system because
A) exchange rates fluctuate in response to, but are not determined solely by, market forces. B) some countries keep their currencies pegged to the dollar, which is not allowed to fluctuate. C) all countries allow their exchange rates to fluctuate in response to market forces. D) all countries peg their currencies to the dollar which is allowed to fluctuate in response to market forces.