Will all monopolistic firms always generate economic profits? Why or why not?
No, a monopolistic firm will not necessarily generate an economic profit. If a firm is the only seller but demand falls then the firm may generate an economic loss in the short run. Graphically this type of loss would be illustrated as the demand curve lying below the ATC curve.
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The Great Depression of the 1930s led to a revolution in macroeconomic thinking, following the work of
A. Arthur Laffer. B. Milton Friedman. C. Adam Smith. D. John Maynard Keynes. E. David Ricardo.
By the legal definition of unemployment, a person who has quit his job to take care of his children full time is
A) unemployed. B) not in the labor force. C) employed. D) in the labor force.
Which of the following explains the ability of the U.S. economy to avoid diminishing marginal returns and experience accelerating growth in the early to mid-20th century?
A) immigration B) additions of a greater amount of capital of the same quality C) a decrease in the quality of labor D) continuing technological change
The observation that the money supply is procyclical and leading the level of aggregate economic theory is most closely associated with
A) Lucas and Friedman. B) Friedman and Schwartz. C) Kydland and Prescott. D) David Runkle.