The Herfindahl-Hirschman index is measured by
A) adding the market shares of all firms in an industry.
B) adding the squares of the market shares of all firms in an industry.
C) squaring the sum of the market shares of the all firms in an industry.
D) adding the market shares of the four largest firms in an industry.
Answer: B
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Everything else held constant, a decrease in planned investment expenditure ________ aggregate ________
A) increases; demand B) decreases; demand C) decreases; supply D) increases; supply
Goods market equilibrium in the open economy occurs when
A) desired saving equals desired investment. B) output equals desired consumption plus desired investment plus government spending. C) desired consumption equals desired investment. D) desired saving minus desired investment equals net exports.
Markets characterized by declining long-run average costs are often referred to as
A. natural monopolies. B. diseconomies of scale. C. perfect competition. D. nonprofit organizations.
According to the crowding-out view, budget deficits will:
A. reduce interest rates. B. increase interest rates and retard private investment. C. reduce the investments of foreigners in the United States. D. increase the capital stock available to future generations.