Refer to Table 9.2. (Data are expressed in billions of dollars.)Table 9.2Full Employment Income (Output)Consumers Desire to SpendInvestors Desire to SpendTotal Private SpendingTotal Saving$500$300$250$________$________600375250$________$________700450250$________$________800525250$________$________If the full-employment level of income (YF) in Table 9.2 is $700 billion,
A. There is an inflationary gap of $450 billion.
B. There is an inflationary gap of $700 billion.
C. The economy is in equilibrium.
D. There is a recessionary gap of $250 billion.
Answer: C
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A compensating wage differential is
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If a monopolistically competitive firm can earn a profit, it will increase production until:
a. MR > AVC. b. MR = ATC. c. MC > MR. d. MR = AR. e. MR = MC.
Regulatory capture often occurs because of which of the following?
A) Patent law allows firms to gain monopoly power easily and therefore control a market. B) Government officials want stronger control over industry regulation. C) Consumer groups are effective at lobbying the government for industry regulation. D) Nearly everyone with expertise works in the regulated industry.
Answer the following statement(s) true (T) or false (F)
1. many schools, medical care facilities, and churches operate as nonprofit organizations 2. the government is a nonprofit organization that plays a direct role in the economy by, for example, regulating public utilities that would operate with few or no competitors 3. limited liability is one characteristic of the corporate form of business organization 4. a professional association tries to improve the working conditions, skill levels, and public perceptions of the profession 5. labor unions use collective bargaining to negotiate job-related issues with management