People like consuming peanut butter and jelly together. The price of peanuts increases. At the same time, we see the price for Jelly rise. This would make the price for peanut butter_____________ and the quantity demanded for peanut butter ____________
a. Uncertain; decreases
b. Decreases; increases
c. Decreases; uncertain
d. Increases; uncertain
a
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A perfectly competitive firm maximizes profit when:
a. its marginal revenue is equal to its marginal cost. b. its marginal revenue is greater than its marginal cost. c. its marginal cost is negative. d. its marginal cost is greater than its marginal revenue. e. its marginal cost is minimum.
Refer to the following graph. The price of capital (r) is $20.
Why wouldn't the firm choose to produce 5,000 units of output with the combination at B?
A. At B, MRTS < 3/2.
B. At B, MPK / r >MPL / w.
C. At B, MPL
Why is the Chair of the Fed Reserve considered by many to be the most powerful person in the economic world?
What will be an ideal response?
In the short run, a fiscal policy action that results in a reduction in the size of the budget deficit will cause
A. an inflationary gap if the economy was initially operating below full employment. B. an increase in real GDP with stable prices if the economy was below full employment. C. an inflationary gap if the economy was initially operating at full employment. D. a reduction in real GDP with falling prices if the economy was below or at full employment.