Clara states that "there is a high correlation between the level of people's education and the level of their income." Ellie replies that the correlation occurs because "more education is the best way to earn more income in this country."
a. Both Clara's and Ellie's statements are positive
b. Clara's statement is normative and Ellie's statement is positive
c. Both Clara's and Ellie's statements are normative
d. Clara's statement is positive and Ellie's statement is normative
d. Clara's statement is positive and Ellie's statement is normative
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The figure above provides information about Light-U-Up Utilities, which is a natural monopoly that provides electricity. If Light-U-Up is regulated, what is its economic profit if it must follow an average cost pricing rule?
A) -$60 B) -$20 C) $0 D) $30
In general, the fed funds rate
A) moves in the direction suggested by the Taylor rule. B) moves in the opposite direction as suggested by the Taylor rule. C) is uncorrelated with the Taylor rule prediction. D) None of the above.
A perfectly inelastic demand curve is represented by an upward-sloping straight line
a. True b. False Indicate whether the statement is true or false
Graphically, a firm's profit per unit of output can be found by:
a. the triangle formed under the demand curve. b. the rectangle formed under the demand curve at a given price and quantity combination. c. the rectangle formed under the average-total-cost curve at a given ATC and quantity combination. d. the distance between the demand and average-total-cost curves at any level of output. e. the distance between the horizontal axis and the average-total-cost curves at any level of output.