The low rate of inflation in the 1990s is probably due to
A. the rise of discount stores that minimize distribution costs, thereby holding prices down.
B. the fact that businesses have become meaner and leaner.
C. the advent of E-commerce that increased competition and drove prices down.
D. the flood of imported goods that increased competition with American-made goods.
E. All of the choices are correct.
E. All of the choices are correct.
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Profits are maximized when
A) price equals marginal revenue. B) marginal revenue equals average total costs. C) marginal revenue equals marginal cost. D) when price equals average total costs.
Because monopolists charge a price in excess of marginal cost, it must be the case that monopolists:
A. earn a negative economic profit. B. produce more than the socially optimal level of output. C. earn a positive economic profit. D. produce less than the socially optimal level of output.
Using the rule of 70, if the GDP per capita growth rate in the United States is 3.5 percent, real GDP per capita doubles every:
A. 20 years. B. 24.5 years. C. 35 years. D. 70 years.
If the Fed raises the interest rate, this will ______ inflation and ______ real GDP in the short run.
a. reduce; raise b. increase; lower c. increase; raise d. reduce; lower