In the short run, a decrease in the market demand will cause a perfectly competitive firm to ________ production and ________.
A) decrease; earn economic profit
B) increase; incur economic losses
C) decrease; incur economic losses
D) increase; earn economic profit
C) decrease; incur economic losses
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An open market ________ by the Fed increases the money supply, which leads to ________ interest rates and increased GDP
A) sale; decreased B) purchase; decreased C) purchase; increased D) sale; increased
Since the wide spread acceptance of the Keynesian view during the 1960s,
A) the federal government has run budget deficits during recessions, but substantial budget surpluses during economic expansions. B) perpetual budget deficits have been the norm. C) the federal government has persistently maintained a balanced budget. D) perpetual budget surpluses have been the norm.
The quantity demanded of Pepsi has decreased. The best explanation for this is that
A. the price of Pepsi has increased. B. the price of Coca-Cola has increased. C. Pepsi consumers had an increase in income. D. Pepsi's advertising is not as effective as in the past.
Compared to a proprietorship, an advantage of a partnership is
A. the ability to take advantage of greater specialization. B. the limited liability of the partners. C. that profits are not taxed twice. D. double taxation.