A monopolist responds to an increase in marginal cost by _____ price and _____ output.
A. increasing; decreasing
B. decreasing; decreasing
C. decreasing; increasing
D. increasing; increasing
A. increasing; decreasing
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting downward C. Aggregate demand shifting rightward D. Aggregate demand shifting leftward
Which of the following is true of banks? a. Banks reduce the opportunity cost of holding idle cash
b. Banks act as intermediaries between the government and private investors. c. Banks can reduce risk by lending to rich borrowers. d. Banks reduce the transaction costs of borrowing and lending money. e. Banks can reduce risks by extending more loans.
Foreign trade in goods and services typically involves paying the costs of production in one currency while receiving revenues from sales in another currency
a. True b. False Indicate whether the statement is true or false
Which of the following is likely to have the most price elastic demand?
a. dental floss b. milk c. salt d. diamond earrings