Sam Edison obtains a patent on his new invention: trinoculars. In the long run,
a. he can earn only a normal profit
b. he may suffer an economic loss and stop producing
c. his monopoly power guarantees him a positive economic profit
d. he will achieve productive efficiency
e. he will achieve allocative efficiency
B
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The payoff matrix below shows the payoffs (in millions of dollars) for two firms, A and B, for two different strategies, investing in new capital or not investing in new capital. 
Firm A's dominant strategy is to ________, and Firm B's dominant strategy is to ________.
A. not invest; not invest B. invest; not invest C. invest; invest D. not invest; invest
Use the following graphs of production possibilities curves to answer the next question.
Suppose the world economy is composed of just two countries: Italy and Greece. Each can produce steel or chemicals, but at the different levels of economic efficiency shown in the graphs. It can be deduced that
A. Greece has a comparative advantage in chemicals. B. it is more costly in terms of resources to produce steel in Italy. C. Greece has the absolute advantage in both products. D. Italy has a comparative advantage in chemicals.
Looking at the macroeconomic statistics for Friedmanland, you discover that at the beginning of the year, the national money supply was equal to $400 million and by the end of the year it was equal to $420 million
You also found out that the inflation rate in Friedmanland was 7%. In this case, you would expect the LM curve to A) shift up and to the left as the real money supply falls. B) shift up and to the left as the real money supply rises. C) shift down and to the right as the real money supply falls. D) shift down and to the right as the real money supply rises.
The multiplier is increased when income taxes are included
a. True b. False Indicate whether the statement is true or false