When asset prices rise above their fundamental economic values, a(n) ________ occurs
A) asset-price bubble
B) liability war
C) decline in lending
D) decrease in moral hazard
A
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As an economy moves down along a straight line production possibilities frontier, what happens to the opportunity cost of producing the good on the horizontal axis?
A) It remains constant. B) It decreases. C) It increases. D) Above the midpoint it decreases until it equals 1 at the midpoint and then it increases. E) None of these depicts what happens to opportunity cost.
Assume that autonomous consumption equals $200 and that the mpc equals 0.8. If disposable income equals $1000, then total consumption equals
A) $80. B) $200. C) $800. D) $1000.
A consumer is in equilibrium when:
a. his or her marginal utility derived from each good is maximized. b. each dollar spent on each item provides more and more satisfaction. c. each dollar spent on each item provides less and less satisfaction. d. the last dollar spent on each item provides the same additional satisfaction as that dollar would if spent on any other item. e. his or her average utility for each item is the same.
If a profit-maximizing monopolist finds that marginal cost is increasing and exceeds marginal revenue, it should: a. increase output and decrease price. b. increase price and decrease output. c. decrease both price and output
d. increase both price and output.