Limit pricing in a contestable market sets the price at the highest level that ________
A) maximizes the profit of an entrant
B) maximizes the profit of the existing firm
C) maximizes the profit of both the existing firm and the entering firm
D) inflicts a loss on an entrant
D
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Stagflation means a simultaneous decrease in the unemployment and inflation rates
a. True b. False Indicate whether the statement is true or false
Which of the following is a tax on labor?
a. Medicare tax b. Social Security tax c. federal income tax d. All of the above are labor taxes.
How did different levels of investment influence the production possibilities curves in this economic growth and production possibilities curve?
a. Economy A saw its curve contract inward.
b. Economy A saw its curve shift further outward than Economy B.
c. Economy B saw no change in its curve.
d. Economy B saw its curve shift from concave to a straight line.
With a downsloping demand curve and an upsloping supply curve for a product, a decrease in resource prices will:
A. decrease equilibrium price and quantity. B. decrease equilibrium price and increase equilibrium quantity. C. increase equilibrium price and decrease equilibrium quantity. D. increase equilibrium price and quantity.