Which product would be likely to be bought in the same quantity even if it doubled in price?
(A) Shoes
(B) Computers
(C) Telephones
(D) Pencils
Ans: (D) Pencils
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Avner is maximizing total utility by buying sports magazines and protein supplements. For him to buy more sports magazines
A) the price of sports magazines has to fall. B) the price of sports magazines has to rise. C) the price of protein supplements. has to fall. D) Since Avner is maximizing his utility, nothing can change the consumption of sports magazines.
Economists assume that the goal of a firm is to
A) maximize economic profits. B) sell as many units as possible. C) maximize gross revenues. D) be the largest firm in its industry.
When Dale visits the doctor, Dale does not pay for either the visit or any tests the doctor may order. From this we can infer that Dale must:
A. have first-dollar medical insurance coverage. B. have a medical insurance policy with a deductible. C. be underutilizing medical care. D. be a member of an HMO.
Suppose the inflation rate target is "0" and the long run federal funds target is also "0." If the federal funds rate set using the Taylor rule is 1.5% and inflation rate is 3%, the output gap is ________
A) 1.5% B) 6% C) -6% D) 4.5%