If a firm responded to a decrease in demand for its product by cutting its price to increase sales, but then all firms experienced a decrease in demand for their products, sticky prices in the aggregate would prevent aggregate demand from rebounding. This is an example of
a. a macroeconomic externality.
b. the Expenditure-Output model.
c. the expenditure multiplier.
d. the coordination argument.
a. a macroeconomic externality.
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Marginal revenue product is defined as the extra:
a. output a firm would receive after hiring one more unit of resource. b. cost of hiring one more unit of resource c. revenue earned by selling one more unit of product. d. revenue earned by hiring one more unit of resource e. output received by spending one more dollar on resources
Which of the following is a test of nonnested models??
A. ?Davidson-MacKinnon test B. ?Standard F test C. ?Regression Specification Error Test D. Whitetest
For Product X, the income elasticity of demand is 1.16. Which of the following is therefore definitely TRUE?
A) Product X is a necessity. B) Product X is income elastic. C) Product X is a substitute for some other good. D) Product X is something that mostly poor people will buy.
An effective price ceiling usually generates
A) fire sales as firms try to unload their excess inventories. B) higher nominal prices. C) the use of nonprice rationing devices. D) happy sellers and dissatisfied buyers.