Refer to the data provided in Table 9.1 below to answer the question(s) that follow.
Table 9.1
Refer to Table 9.1. If the market price is $42, then in the long run the firm will
A. operate and expand.
B. operate but not expand.
C. shut down, but not go out of business.
D. go out of business.
Answer: A
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Which one of the following is an example of passive policy making?
A) introducing expansionary monetary policy to combat a recession B) introducing expansionary monetary policy to combat inflation C) introducing expansionary fiscal policy to combat a recession D) following a predetermined monetary policy rule
Samuelson and Solow believed that the Phillips curve
a. implied that low unemployment was associated with low inflation. b. indicated that the aggregate supply and aggregate demand model was incorrect. c. offered policymakers a menu of possible economic outcomes from which to choose. d. All of the above are correct.
If the demand function for a particular good is Q = 20 ? 8P, then the price elasticity of demand (in absolute value) at a price of $1 is:
A. 1/8. B. 2/3. C. 8. D. 2.
Which of the following is NOT necessary in order for a monopolist to practice effective price discrimination?
A) The marginal cost of providing the same good to different groups of buyers must be different. B) The monopolist must be able to segregate its market into different submarkets. C) The buyers in various markets must face different price elasticities of demand. D) The monopolist must have a downward sloping demand curve.