Figure 10-5
In Figure 10-5, which graph best illustrates the situation of an economy reacting to an inflationary gap through an increase in wage levels?
A. (1)
B. (2)
C. (3)
D. -(4)
Answer: D
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Which of the following is the best example of a natural monopoly?
A) ownership of the only ferry across Puget Sound for twenty miles B) the United States Postal Service C) the cable television company in your hometown D) owning the only licensed taxicab in town E) producing a patented drug
Total fixed cost falls as output expands.
Answer the following statement true (T) or false (F)
When a game has multiple equilibria, a useful method to sort out which one would be the "best" prediction is to
a. find the one (if any) in which both players are better off than in any other equilibrium. b. find the equilibrium that is symmetric, if any. c. find the one which seems "focal", if any. d. all of the above.
Suppose the demand for peanuts increases. What will happen to producer surplus in the market for peanuts?
a. It increases. b. It decreases. c. It remains unchanged. d. It may increase, decrease, or remain unchanged.