If Veronica withdraws $1,500 from her checking account and deposits it in her savings account, then M1 will ________ and M2 will ________
A) decrease; increase
B) increase; not change
C) decrease; not change
D) not change; not change
C
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Suppose that the price level was 100 in 2011, 110 in 2012, and 130 in 2013. Over these three years
A) deflation occurred at an accelerating rate. B) the inflation rate was positive but slowing. C) prices were stable. D) the inflation rate was positive and accelerating.
How does an increase in income affect the market for iPads (normal good)?
a. The demand curve for iPads shifts to the right b. The demand curve for iPads shifts to the left c. The supply curve for iPads shifts to the right d. The supply curve for iPads shifts to the left
Advertising: a. cannot influence market demand
b. shifts the average total cost curve upward. c. is used only by perfectly competitive firms. d. makes demand more elastic by creating customer loyalty.
Answer the following statements true (T) or false (F)
1. Once the monopolistic competitor is established and earning positive economic profits, no other firms will be able to profitably enter the market. 2. There are no benefits to monopolistic competition, because it does not provide either productive or allocative efficiency. 3. Oligopolies can form when smaller firms would have higher average costs and be unable to compete, while larger firms would produce such a high quantity that they would not be able to sell it at a profitable price. 4. Even when oligopolists recognize that they would benefit as a group by acting like a monopoly, if one or more give in to the temptation to produce just a slightly higher quantity and earn a slightly higher profit, the market price will fall. 5. Because of antitrust regulations, merging businesses are not allowed to hire workers or lay them off for a period of at least 18 months.