Rational expectations theory is based on the assumption that when individuals in the economy are forming expectations, they
A) use all available information.
B) use past evidence only.
C) consistently make the same errors.
D) pay no attention to past information.
A
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The discount rate is the
A) banks' real interest rate. B) interest rate at which the Fed will loan reserves to commercial banks. C) interest rate banks charge the Fed when the Fed borrows from the banks. D) name of the interest rate banks charge their most credit-worthy borrowers. E) interest rate paid on U.S. government securities.
How is the market demand curve for a public good derived?
What will be an ideal response?
What are the three cases for the price elasticity of demand? Briefly define each
What will be an ideal response?
A monopolist's cost curves will
a. be identical to those of a competitive firm. b. be higher than a competitive firm's cost curves. c. be peculiar to the individual producer since there is only one. d. drop more steeply as output increases.