According to the theory of comparative advantage, ________ raise(s) productivity by lowering opportunity costs.
A. economic growth
B. investment in capital goods
C. exchange and consumption
D. trade and specialization
Answer: D
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Contractionary monetary policy shifts the reserve supply schedule inward
a. True b. False Indicate whether the statement is true or false
Name and explain the three reasons for holding money balances.
What will be an ideal response?
Which of the following is the correct formula for the simple spending multiplier?
a. (1-MPC)/1 b. 1/(1-MPC) c. MPS/(1-MPC) d. MPC/(1-MPS)
Quick Buck and Pushy Sales produce and sell identical products and face zero marginal and average cost. Below is the market demand curve for their product.
Suppose Quick Buck and Pushy Sales decide to collude and work together as a monopolist with each firm producing half the quantity demanded by the market at the monopoly price. If Quick Buck cheats by reducing its price to $1 while Pushy Sales continues to comply with the collusive agreement, then Quick Buck's economic profit will be ________.
A. $4,000 B. $3,000 C. $2,000 D. $6,000