Under sticky prices
A) a fall in the money supply raises the interest rate to preserve money market equilibrium.
B) a fall in the money supply reduces the interest rate to preserve money market equilibrium.
C) a fall in the money supply keeps the interest rate intact to preserve money market equilibrium.
D) a fall in the money supply does not affect the interest rate in the short run, only in the long run.
E) a fall in the money supply raises the interest rate to preserve money market equilibrium in the long run.
A
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In the short run, which of the following would indicate that a perfectly competitive firm is producing an output for which it is receiving a normal profit?
A) P > AC B) AVC < P < AC C) P = AC D) P = AVC
Which of the following is not counted as income when the official poverty rate is calculated?
a. Medicaid benefits. b. dividends derived from the ownership of stock. c. earnings derived from a part-time job. d. money income derived from transfer payments.
Assume that in Canada the opportunity cost of producing one television set is two bushels of wheat. Assume that in the United States the opportunity cost of producing one bushel of wheat is two television sets. If these two countries specialize according to comparative advantage and then trade with each other:
A. the United States will import both televisions and wheat. B. Canada will import wheat and export televisions. C. Canada will import both televisions and wheat. D. the United States will import wheat and export televisions.
A consumer has been buying 2 magazines and 1 book each month. The price of magazines then decreases, which directly causes the marginal utility per dollar spent on
A. magazines to increase, thereby inducing the consumer to purchase more magazines and fewer books. B. books to increase, thereby inducing the consumer to purchase fewer magazines and more books. C. magazines to increase, thereby inducing the consumer to purchase fewer magazines and more books. D. books to decrease, thereby inducing the consumer to purchase fewer magazines and more books.