To an economist, theory can be thought of as
A. abstraction for the sake of argument.
B. one person’s opinion, which is just as good as another’s.
C. another term for the description of a situation.
D. beliefs that cannot necessarily be verified.
E. explanation of mechanisms behind observed phenomena.
Answer: E
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In the above figure, the price received by the seller before the tax is ________ per compact disc, and the price received and kept by the seller after the tax is ________ per compact disc
A) $20; $20 B) $20; $10 C) $30; $20 D) $30; $10
Which of the following would be most likely to have monopoly power?
a. a national florist b. an online bookstore c. a local restaurant d. a local electrical cooperative
One reason stagflation is difficult to recover from is because:
A. less output requires less inputs to be hired. B. prices tend to adjust more quickly downward than upward. C. wages are sticky downward. D. input prices increase with output prices.
If import restrictions prohibit foreigners from selling various goods and services in the U.S. market,
A) the U.S. will be able to export more goods abroad. B) the U.S. will be able to produce more output than would be otherwise the case. C) foreigners will have fewer U.S. dollars with which to buy U.S. goods and services. D) the domestic producers in the protected industries will supply goods to U.S. consumers at lower prices than would be otherwise the case.