Unlike the classical economists, Keynes asserted that
A. Prices and wages were flexible.
B. Markets would naturally self-adjust.
C. Laissez faire policies would lead to macro equilibrium.
D. The economy was inherently unstable.
Answer: D
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After an increase in demand in a constant-cost industry, firms will find themselves with higher average cost curves
Indicate whether the statement is true or false
The ratio of non-performing loans to total loans is a measure of a bank's __________ risk
A) credit B) leverage C) interest rate D) liquidity
When a shortage exists in a market, sellers
a. raise price, which increases quantity demanded and decreases quantity supplied until the shortage is eliminated. b. raise price, which decreases quantity demanded and increases quantity supplied until the shortage is eliminated. c. lower price, which increases quantity demanded and decreases quantity supplied until the shortage is eliminated. d. lower price, which decreases quantity demanded and increases quantity supplied until the shortage is eliminated.
In general, as units of resource inputs rise, their marginal revenue product
A. rises. B. stays the same. C. declines.