Which of the following was not a lesson from the 2007–2009 financial crisis?
A. Financial regulations were too “light” prior to the crisis.
B. Excessive complexity made the financial system more fragile and dangerous.
C. Both monetary policy and fiscal policy are needed in order for the economy to recover.
D. Regulatory failures were based primarily on poor job performance.
Answer: D
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Markets can be least well-defined by
a. product similarity b. location c. price elasticity d. cross-price elasticity e. degree of firm interdependence
If the market price is below the break-even point, in the long run we should expect
A. firms to enter the industry, market supply to rise, and product price to fall. B. firms to leave the industry, market supply to rise, and product price to fall. C. firms to leave the industry, market supply to fall, and product price to rise. D. no change in the number of firms in this industry.
If supply increases and demand remains unchanged, equilibrium quantity will _______ and equilibrium price will ______________.
A. rise; rise B. fall; fall C. fall; rise D. rise; fall
Which of the following is a characteristic shared by a perfectly competitive firm and a monopoly?
A) Each sets a price for its product that will maximize its revenue. B) Each maximizes profits by producing a quantity for which price equals marginal cost. C) Each maximizes profits by producing a quantity for which marginal revenue equals marginal cost. D) Each must lower its price to sell more output.