A monopolistic competitor is like a competitive firm in the long run, because
A. it earns zero economic profits
B. both firms will increase price to increase profits.
C. it earns positive economic profits.
D. both firms will earn positive economic profits.
Answer: A
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If a firm operates in a competitive industry and its unionized labor force is successful in bargaining for a wage increase, where is the firm likely to get the money to pay the higher wages?
M1 money includes all but which one of the following?
a. Savings accounts b. Paper money c. Coins d. Checkable deposits
Using Figure 8.1, a decrease in the quantity of aggregate demand resulting from the interest rate effect would be depicted as a movement from point
A. A to point C. B. B to point C. C. C to point A. D. B to point A.
In the short-run macro model, if GDP is $5 trillion and aggregate expenditure is $4 trillion,
a. GDP will rise because inventories will rise b. GDP will fall because inventories will fall c. GDP will remain the same because this is an equilibrium d. investment will decrease e. the government will have to increase taxes