Prices
A. solve the problem of distribution of products among consumers.
B. act as rationing devices.
C. under laissez-faire produce an efficient allocation of resources.
D. do all of the things listed here.
Answer: D
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Perfect price discrimination is
A) realistic. B) practiced by many firms. C) a purely theoretical possibility. D) very common.
Suppose the production of VCRs can be represented by the following production function: q = L0.4 K0.4. The firm currently produces units. If all inputs doubled, the new level of output will equal
A) 20.4 q1. B) 20.8 q1. C) 0.8 q1. D) 1.6 q1.
Which of the following would be counted in U.S. GDP?
a. A new U.S.-produced radio bought by a Japanese citizen living in Kyoto b. A used U.S.-produced computer bought by a French citizen living in Kansas c. A new Japanese radio bought by a U.S. citizen in Rhode Island d. A U.S. pianist's concert sales in Britain e. Stock in Microsoft Corporation bought by a Russian citizen
Assume that the expectation of a recession next year causes business investments and household consumption to fall, as well as the financing to support it. If the nation has low mobility international capital markets and a fixed exchange rate system, what happens to the GDP Price Index and the nominal value of the domestic currency in the context of the Three-Sector-Model? a. The GDP Price Index
rises and nominal value of the domestic currency remains the same. b. The GDP Price Index falls and nominal value of the domestic currency remains the same. c. The GDP Price Index and nominal value of the domestic currency remain the same. d. The GDP Price Index falls and nominal value of the domestic currency falls. e. There is not enough information to determine what happens to these two macroeconomic variables.