A monopsonist wants to purchase more labor. Which of the following statements is TRUE?
A) The wage rate that the monopsonist has to pay future workers is lower than it pays current workers since there is no other place to work.
B) The wage rate that the monopsonist has to pay future workers will be the same rate it pays current workers.
C) The wage rate that the monopsonist has to pay future workers is higher than what it will continue to pay current workers.
D) The monopsonist will have to raise the wage rate for current and additional employees.
Answer: D
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Using the Taylor rule, if the current inflation rate equals the target inflation rate and real GDP equals potential GDP, then the federal funds target rate equals the
A) current inflation rate plus the real equilibrium federal funds rate. B) real equilibrium federal funds rate. C) current inflation rate. D) current discount rate.
Which of the following is true about the equation of exchange?
a. The equation of exchange can be presented as: M V = P Q b. Velocity represents the average number of times that a dollar is used in purchasing final goods or services in a one-year period. c. If M increases, and V remains constant, then P must rise and/or Q must rise. d. All of the above are true about the equation of exchange.
Figure 11-9
In Figure 11-9, how much more than the long-run competitive price will the profit-maximizing monopolist charge?
a.
$1
b.
$2
c.
$3
d.
$11
The marginal revenue curve of a monopolistically competitive firm is
A) downward sloping and above the demand curve. B) downward sloping and below the demand curve. C) identical to the demand curve as there are many small firms in the market. D) perfectly elastic.