Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential
B. higher; potential
C. higher; higher
D. lower; higher
Answer: B
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A market with few entry barriers and with many firms that sell differentiated products is
A) purely competitive. B) a monopoly. C) monopolistically competitive. D) oligopolistic.
The economic problem can best be stated as:
A. Given the fact that the economy is inefficient, how much and what type of government intervention should be used to improve the efficiency of the economy? B. What is the best rate of economic growth for a society? C. Given scarce resources, how exactly do societies go about deciding what to produce, how to produce it, and for whom to produce? D. How can the economy improve technology so as to shift the production possibility frontier up and to the right?
A(n) ________ industry is characterized by strategic behavior.
A. oligopolistic B. monopolistic C. monopolistically competitive D. perfectly competitive
Critics of the marginal productivity theory of income distribution claim that the theory is flawed due to:
A. The law of diminishing returns B. The existence of imperfect competition, such as of monopoly and monopsony, in output and resource markets C. The problem of comparing different kinds of resources, such as capital and labor D. Government policies which redistribute income