In the long run, all firms in a perfectly competitive industry
A) earn economic profits.
B) break even.
C) suffer economic losses.
D) sell differentiated products to earn economic profits.
B
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The figure above shows the labor market in a small town. If the government imposes a wage of $10 that firms must at least pay,
A) the government has imposed a minimum wage and market forces are not allowed to work. B) inflation will occur as wages rise. C) job search will decrease. D) the government has imposed an efficiency wage. E) job rationing will decrease.
Which of the following is correct?
a. A bank's deposits at the Federal Reserve counts as part of the bank's reserves. The Federal Reserve pays interest on these deposits. b. A bank's deposits at the Federal Reserve counts as part of the bank's reserves. The Federal Reserve does not pay interest on these deposits. c. A bank's deposits at the Federal Reserve does not count as part of the bank's reserves. The Federal Reserve pays interest on these deposits. d. A bank's deposits at the Federal Reserve does not count as part of the bank's reserves. The Federal Reserve does not pay interest on these deposits.
In an open economy (as compared to a closed one, without international trade)
A. monetary policy is weaker, fiscal policy is more powerful B. fiscal policy is weaker, monetary policy is more powerful C. both monetary and fiscal policy are more powerful D. both monetary and fiscal policy are weaker
Which of the following is assumed to be the most important motivation for producers?
A. The desire to minimize external costs. B. The desire to minimize social costs above private costs. C. The desire to maximize social benefits and private revenues at the same time. D. The desire to maximize economic profits.