When the marginal social cost is greater than the private social cost then the good is _____.
a. under consumed
b. under produced
c. over produced
d. over consumed
c. over produced
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In order to ________ the long-run real interest rate, the Fed needs to ________
A) raise; raise the long-run inflation expectations B) raise; lower the long-run nominal interest rate C) lower; raise the long-run nominal interest rate D) lower; raise the long-run inflation expectations
Firms are ________ with an economic profit of zero, they will ________ in the industry because they ________ be better off in another industry
A) satisfied, stay, won't B) unsatisfied, leave, will C) satisfied, leave, will D) unsatisfied, stay, won't
Suppose a plant manager ignores some implicit marginal costs of production so that the perceived MC curve is below the actual MC curve. What is the likely outcome from this error?
A) Firm produces less than optimal quantity and earns lower profits B) Firm produces less than optimal quantity and earns higher profits C) Firm produces more than optimal quantity and earns lower profits D) Firm produces more than optimal quantity and earns higher profits
If foreigners increase their ownership of U.S. assets, this would help to offset
a. a deficit in the U.S. current account b. a deficit in the U.S. capital account c. a surplus in the U.S. current account d. a surplus in the U.S. capital account e. a surplus in the total balance of payments