What is defined as the ability of a firm to earn high profits by raising and keeping the prices of its products substantially above the levels at which those products would be priced in competitive markets?
a. Economies of scope
b. Tacit collusion
c. Monopoly power
d. Perfect competition
c
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According to rational expectations theory, which of the following is the best approach to lower the inflation rate?
a. Preannounced stable government policies. b. Unpredictable government policies. c. First predictable and then unpredictable government policies. d. None of these.
The United States has experienced both budget surpluses and deficits since 2000.
Which of the following is a reason people choose to hold more cash?
a) Interest rates paid on savings and checking accounts at the bank rise dramatically. b) Consumers have more faith in the stability and safety of the financial system. c) Interest rates paid on savings and checking accounts at the bank are near zero. d) Holding cash becomes less convenient.
Income:
A. is a stock concept. B. consists of accumulated assets. C. is a flow concept. D. consists of wages only.