Suppose a person defects from Cuba (a country that generally disregards the use of markets) to the United States and asks to see a market in action. Where would you take her? Did you give her a complete showing of this market?
Most students will provide answers such as the grocery store, a mall, or an automobile dealership, which are all good examples of the physical acts of trade and commerce. A physical "marketplace," however, is just the beginning of what economists mean when they talk about a "market." This question is useful in helping students understand that a market is not necessarily a place but a term used to describe a process. You may want to contrast the different types of markets mentioned such as supermarkets (posted prices), car dealerships (some price negotiation), and flea markets (relatively high levels of dickering).
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The MC = MR rule for profit maximization applies to monopolists, as well as to firms in perfect competition
Indicate whether the statement is true or false
The word "efficient" in the term "efficient markets hypothesis" refers to the idea that
a. fundamental analysis is an efficient way to go about choosing which stocks to buy or sell. b. stock prices move upward and downward "efficiently," rather than following a "random walk.". c. the stock market is "informationally efficient.". d. companies employ officers and managers who are well-qualified to perform their jobs.
Which of the following includes everyone in the adult population that the Bureau of Labor Statistics counts as "unemployed"?
a. anyone who is not employed b. anyone who is not employed, is available for work, and has looked for work in the past four weeks c. anyone who is not employed, is available for work, has looked for work in the past four weeks, and anyone who is waiting to be recalled from a job from which they have been laid off d. anyone who is not employed, is available for work, has looked for work in the past four weeks, anyone who is waiting to be recalled from a job from which they have been laid off, and anyone who is employed part time and has searched for full time employment in the past 4 weeks
The multiplier process can occur when a decrease in investment spending
A. Increases household saving, causing consumers to buy more goods and services. B. Increases household incomes, causing consumers to buy fewer goods and services. C. Reduces household incomes, causing consumers to buy more goods and services. D. Reduces household incomes, causing consumers to buy fewer goods and services.