The principle that irrelevant detail should not be included in a model is known as
A. Ockham's razor.
B. normative economics.
C. ceteris paribus.
D. a fallacy.
Answer: A
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A monopoly faces an inverse demand curve of P = 100 - 2Q. The marginal cost curve is MC = .5Q. What government price ceiling would represent optimal price regulation?
What will be an ideal response?
The four largest firms account for approximately 95% of U.S. cigarette sales. The U.S. cigarette industry would be best classified as a(n)
A. oligopoly. B. monopolistically competitive industry. C. monopoly. D. perfectly competitive industry.
According to the real business cycle theory, which of the following would be a real disturbance to the economy?
A) change in the required reserve ratio B) reduction in the money supply C) increase in the rate at which married women participate in the labor force D) increase in the price level
When deriving the production possibilities curve, it is assumed that
A) the amount of each good that is to be produced is fixed. B) the prices of resources are fixed along the curve. C) most resources can be used to produce only one good. D) resources are efficiently used.