If your firm is producing a good at a level where marginal revenue equals marginal cost, and price is between average variable cost and average total cost, then in the short run your firm should:
A. shut down and suffer a loss equal to your fixed costs.
B. continue to produce, but increase output.
C. continue to produce at the same level of output.
D. continue to produce, but decrease output.
Answer: C
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Suppose the economy is currently in equilibrium at output level Q2, but full-employment output is at level Q1. If the government fails to enact fiscal policy and no other conditions change, the eventual price level will most likely be closest to
A. P0. B. P1. C. P2. D. P3.
If a 10 percent rise in price leads to a reduction in quantity demanded of more than 10 percent,
A. demand is elastic. B. demand is inelastic. C. elasticity of demand is unitary. D. None of the above is correct.
The U.S. National Commission on Fiscal Policy and Reform has recommended changes to government expenditures and taxes which they claim would reduce the increase in the national debt between 2012 and 2020 to $4 trillion rather than $8 trillion
What are the commission's 5 recommendations?
In a sharp regression discontinuity design,
A) crossing the threshold influences receipt of the treatment but is not the sole determinant. B) the population regression line must be linear above and below the threshold. C) Xi will in general be correlated with ui. D) receipt of treatment is entirely determined by whether W exceeds the threshold.