Which of the following is true of an inflationary gap?
a. It results in an inflationary increase in the price level of an economy
b. It occurs when an economy's aggregate expenditures are lower than its actual output.
c. It results in an increase in the stock of inventories.
d. It results in a decrease in input prices.
a
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The spread between the bid price and the offer price is a measure of
A) the underwriters' spread. B) brokers' fees. C) liquidity costs. D) sunk costs.
There are 30 firms in an industry. What happens to that industry's four-firm concentration when the third- and fourth-largest firms merge?
A) Nothing, because their shares are already included in the concentration calculation. B) The industry's concentration ratio will fall. C) The industry's concentration ratio will increase. D) It is impossible to know without more information.
Which of the following sayings describes the concept of diminishing marginal utility?
a. time is money b. penny wise and pound foolish c. absence makes the heart grow fonder d. a penny saved is a penny earned e. a fool and his money are soon parted
If the supply of steel is perfectly elastic, then an increase in the demand for steel will
A. increase the price of steel but have no effect on quantity supplied. B. increase the quantity of steel supplies but have no effect on the price. C. have no effect on the price or the quantity supplied. D. decrease total revenue taken in by steel producers.