In order for the price system to have satisfied the exacting requirements for efficiency,
a. MU must equal MC for each and every commodity.
b. the average cost of producing each good must be equal to its MU.
c. the maximum possible of total economic profit must be produced.
d. every consumer's MU will be equal to marginal physical product
a
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In the short run, a change in the equilibrium price will
A) always lead to inflation. B) cause a shift in the demand curve. C) cause a shift in the supply curve. D) cause a change in the quantity demanded or supplied.
All of the following result from price floors in agriculture EXCEPT
A) surpluses of agricultural products that have price floors. B) higher prices to consumers for agricultural products that have price floors. C) lower prices to consumers for agricultural products that have price floors. D) governmental bureaucracy.
it permits people to expand production and achieve rates of output that would otherwise be unattainable
What will be an ideal response?
Recall the Application about the Fed's response to the collapse of the investment house Bear Stearns as well as its handling of the 2008 financial crisis with respect to other financial institutions to answer the following question(s). According to this Application, the Fed responded to the financial crisis by continuing to develop new programs. One example of this was its announcement that it would now purchase commercial paper, which is the short-term debt of corporations. This is an example of the Fed acting as a:
A. medium of exchange. B. lender of last resort. C. store of value. D. unit of account.