Answer the following statement(s) true (T) or false (F)
1. A market price contains no more information about a good than a good social planner would be able to obtain.
2. According to F.A. Hayek, knowledge is lost as statistics are used to convey information.
3. Whether a good is distributed by a social planner or a market system, the area beneath the demand curve out to the quantity available accurately measures the value consumers receive.
4. When allocation decision are not made on the basis of price traditional methods of social gain understate the actual gain to society.
1. False
2. True
3. False
4. False
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Aggregate supply is the same thing as:
a. total national spending. b. total domestic production. c. aggregate demand. d. a supply shock.
Answer the following statement(s) true (T) or false (F)
1. The demand curve for a monopolistic firm is the same as the demand curve for its market. 2. A monopolist’s marginal revenue always less than the price. 3. A monopolist will intentionally operate on the inelastic portion of its demand curve. 4. If marginal costs exceed marginal revenues, profits drop. 5. Multiplying average total cost by the output level gives the total cost.
GDP per capita is the best measurement for:
A. Determining the distribution of output within a country. B. Determining the growth rate of the economy over time. C. Finding the impact of population on GDP. D. Comparing living standards between countries.
In the above table, the level of autonomous consumption is
A. $0. B. $5,000. C. $1,000. D. $9,000.