In the short run, an increase in the price level induces firms to expand production because
A) they can increase profits by increasing maintenance costs.
B) higher prices allow firms to hire more inputs by offering higher prices for inputs, which increases productivity and profits.
C) each firm must keep its production level up to the level of its rivals, and some firms will expand production as the price level increases.
D) prices of inputs are held constant, so the higher prices for firms' products imply that it is profitable to expand production.
D
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Money functions as a(n)
A) medium of exchange. B) unit of account. C) store of value. D) all of the above.
Suppose that utility over consumption and leisure takes the constant elasticity of substitution form 
. If 
falls between 0 and -1, then the labor supply curve is backward bending.
Answer the following statement true (T) or false (F)
Asymmetric information will always cause
A) efficiency problems. B) equity problems. C) Both A and B. D) None of the above.
An increase in the price of a good causes people to buy less of it because
a. the demand for the good decreases b. they have less income to spend on the good c. the marginal utility from additional units of consumption of the good decreases d. the marginal-utility-to-price ratio for the good decreases e. consumer surplus from consumption of the good decreases