Regulation that keeps the rate of return in the industry competitive is known as
A) rate-of-return regulation.
B) cost-of-service regulation.
C) social regulation.
D) deregulation.
Answer: A
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Same level of fiscal and monetary policy can be generated by _________________________________________, but the composition of GDP will be different in each case.
A. more than one mix of fiscal and monetary policy B. only fiscal policy C. monetary policy D. none of these
To maximize cartel profit, the members must allocate output so that the marginal cost for the final unit produced by each firm is
a. identical b. unequal c. negative d. equal to the firm's average total cost e. maximized
One of the potential economic problems associated with the extensive use of macropolicy to recover from the Great Recession is
A. the huge government deficits will cause increasing interest rates which could choke off the recovery. B. the large amount of government spending for job creation could result in rapid and uncontrollable increases in wages. C. the flood of money into the banks could cause excessive investment expenditures in the economy. D. the tax rebates made available to consumers could cause uncontrollable increases in the price of housing.
Using Figure 1 above, if the aggregate demand curve shifts from AD1 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y2. C. P3 and Y1. D. P2 and Y3.