An increase in the interest rate will:
a. increase the amount of money borrowed by firms
b. decrease the amount of money borrowed by firms.
c. have an ambiguous effect on the amount of money borrowed by firms.
d. have no effect on the amount of money borrowed by firms.
b
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Which of the following explains why talented major league baseball players command much higher salaries than neurosurgeons?
A) because it takes far more skill and training to be a major league baseball player than to be a neurosurgeon B) because the supply of talented major league baseball players is low relative to its demand compared to the supply of neurosurgeons. Therefore, adding another player yields far greater marginal benefit than adding another neurosurgeon. C) because the total value of baseball games is much higher than the total value of neurosurgery D) because the supply of talented major league baseball players is relatively low compared to the supply of neurosurgeons. Therefore, major league baseball players exert far more market power than neurosurgeons.
According to the following graph, if U2 is the maximum attainable utility, the price of X is
The price of Y is $50.
A. $10. B. $25. C. $15. D. $20. E. none of the above
The price level rises more rapidly as the maximum output level is approached along an aggregate supply curve because
A. profit-taking firms are exploiting their market size and power. B. of the profit incentive. C. the costs of additional units of aggregate output begin to rise more rapidly, causing firms to seek higher prices to cover these rising costs. D. None of the choices are correct.
In Figure 32.1, at the supported price-quantity combination where production is unlimited, and government buys the excess, the variable cost to producers is 
A. 0HEQS. B. 0HGQD. C. 0ABQD. D. 0HCQ*.