As firms ________ a monopolistically competitive industry the demand and marginal revenue curves facing each firm begin to shift to the ________.
A. enter; right
B. exit; left
C. exit; right
D. expand in; right
Answer: C
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A surplus occurs when price is higher than the market equilibrium.
Answer the following statement true (T) or false (F)
Kevin deposits a certain sum in a bank at an annual compounded rate of interest for two years. Interest in the second year will be calculated on:
A) the principal amount only. B) the amount in the account after one year. C) the sum of the principal amount and the amount in the account after one year. D) the difference in the principal amount and the amount in the account after one year.
To model the input decisions for a production system, we plot labor on the horizontal axis and capital on the vertical axis. In the short run, labor is a variable input and capital is fixed
The short-run expansion path for this production system is: A) a vertical line. B) a horizontal line. C) equal to the 45-degree line from the origin. D) not defined.
According to the Application, economist John B. Taylor found that the temporary tax cuts which were a part of the 2009 stimulus package
A) were primarily used to pay off home mortgage balances. B) were split very evenly between consumption spending and household saving. C) were very successful in stimulating consumption spending. D) did very little to stimulate consumption spending.