Economists assume that the goal of a firm is to
A) maximize economic profits.
B) sell as many units as possible.
C) maximize gross revenues.
D) be the largest firm in its industry.
A
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Suppose that you consume only pizza and Diet Pepsi. The table above gives your utility from consuming these two goods. What is the marginal utility you get from the fourth slice of pizza?
A) 36 B) 18 C) 12 D) 4
Using the utility possibilities frontier above explain three ways that this society of two individuals can be made better off without making anyone worse off if it starts at point A
What will be an ideal response?
During 2003, the Federal Reserve began to openly discuss deflation. Their comments suggested they
A. knew it was something to watch because of the Japanese experience of the 1990s, but did not alter policy significantly to combat it. B. were neutral about whether deflation would be a good thing. C. were enthusiastic about the possibility. D. knew it would be a disaster, so they immediately cut the target federal funds rate by 5 percentage points to avoid the possibility.
One of the consequences of the U.S. trade deficit is that:
A. domestic inflation has resulted. B. the accumulation of American dollars in foreign hands has enabled foreign firms to build factories in America. C. the distribution of income in the United States has become less unequal. D. the system of flexible exchange rates has been abandoned in favor of a new gold standard.