Under a pure command system of government, decisions are made by:
a. firms.
b. households.
c. the central government.
d. banks.
c
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What impact does an increase in the price level in the United States have on net exports and why?
A) An increase in the price level decreases net exports by increasing the relative cost of American goods. B) An increase in the price level increases net exports because higher prices decrease American spending on imports. C) An increase in the price level decreases net exports because higher prices decrease the value of the dollar. D) An increase in the price level increases net exports because higher prices lower the value of the dollar.
What is the Haig-Simons definition of income? Are there any practical problems in implementing the Haig-Simons definition?
What will be an ideal response?
Corporations have a separation and control problem because
A) owners and managers frequently have different incentives. B) most of the profits are reinvested. C) the shareholders control the firm. D) taxes are paid only by the board of directors.
The long-run equilibrium of a monopolistic competitor differs from the long-run equilibrium of a perfect competitor in that
A) the monopolistic competitor makes economic profits. B) the monopolistic competitor sets price equal to marginal cost. C) the monopolistic competitor produces at the minimum point of its average total cost curve. D) the monopolistic competitor charges a price that exceeds marginal cost.