According to supply-side economists, lowering corporate income taxes
a. results in higher wages without creating higher levels of labor productivity
b. creates greater income equality
c. checks the expansion of real GDP and employment
d. stimulates investment and spurs on economic growth
e. is a disincentive to producers who rely on tax credit for investment
D
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The above figure shows the payoff matrix for two firms, A and B, selecting an advertising budget. The firms must choose between a high advertising budget and a low advertising budget. A Nash equilibrium is that
A) firm A selects a high advertising budget and firm B selects a low advertising budget. B) firm A selects a low advertising budget and firm B selects a high advertising budget. C) both firms select a high advertising budget. D) both firms select a low advertising budget.
Which of the following is considered by economists to be the most fundamentally scarce?
a. money b. ideas c. needs d. food e. physical resources
Contestable markets improve the performance of imperfect markets with
a. government regulations. b. the threat of entry. c. advertising. d. tacit collusion.
Diseconomies of scale occur when a firm's
a. marginal costs are constant as output increases. b. long-run average total costs are decreasing as output increases. c. long-run average total costs are increasing as output increases. d. marginal costs are equal to average total costs for all levels of output.