What is the "Hotelling rule" for a monopolist?
A) Price minus marginal cost must rise at exactly the rate of interest.
B) Price plus marginal cost must rise at exactly the rate of interest.
C) Marginal revenue minus marginal cost must rise at exactly the rate of interest.
D) Marginal revenue and marginal cost must be independent of the rate of interest.
C
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The case where people purposely act in a careless way, for example, driving recklessly because they are insured, is called
A) asymmetric information. B) risk aversion. C) moral hazard. D) bounded rationality. E) thrill-seeking.
Which of the following was a successful application of fiscal policy in the United States?
a. Roosevelt's strategy in combating the Great Depression b. The tax cut of 1964 c. The temporary tax surcharge of 1968 d. The battle against stagflation during the 1970s e. The large tax cut of 1981
Suppose there is a 10% rise in the price of gasoline. Then, according to the law of __________, we expect the quantity of gasoline supplied to _____________. Conversely, if the price goes _____________, quantity supplied will ___________, as well.
Fill in the blank(s) with correct word
The optimal method of production maximizes cost for a given level of output.
Answer the following statement true (T) or false (F)