The movement of workers from lower productivity jobs to higher productivity jobs would be an example of a(n):
A. Technological advance
B. Network effects
C. Simultaneous consumption
D. Improved resource allocation
D. Improved resource allocation
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The Federal Reserve ________
A) engages in stabilization policy by setting interest rates B) engages in fiscal policy by setting interest rates C) addresses financial crises by raising taxes D) all of the above E) none of the above
If a firm has market power it may be able
A) to protect market share. B) to continue to earn economic profits. C) minimize marginal costs. D) to maximize total revenue.
According to the rational expectations hypothesis, the attempt by the government to reduce unemployment below its natural rate through expansionary policies will
A. succeed because the government knows how people will react to their policies and will adjust their policies accordingly. B. succeed in the short run and can succeed in the long run as long as the government makes it clear what its goals are. C. fail because the economy can never achieve an unemployment rate below the natural level. D. fail because people will figure out what the government is doing and alter their expectations and their behavior in ways that counteract the government policy.
"Allocative efficiency in the production of cherries means that consumers can eat all of the cherries they desire." Is this statement true or false?
What will be an ideal response?