Prices tend to be sticky because:
A. firms are worried that frequent price changes would annoy consumers.
B. most firms have agreements with each other to fix prices at profit-maximizing levels.
C. government controls most prices.
D. foreign competition discourages domestic firms from price changes.
Answer: A
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In general, in the 19th century, America
(a) was a low tariff nation because it was believed that free trade brought specialization, efficiency and more rapid economic growth. (b) was a nation that kept its tariffs at about the same levels as England so as not to give the British an advantage. (c) was a high tariff nation which believed, from the days of Alexander Hamilton, that America's industry needed protection from the more industrially advanced England. (d) had a moderate level of tariffs, compared with England, whose main purpose was to provide the federal government with revenues.
President George W. Bush’s tax cut in 2001 was a rare example of
A. timely monetary policy. B. timely fiscal policy. C. the slow response of policy to events. D. the inability of Congress to react to policy needs.
A monopolist has four distinct groups of customers. Group A has an elasticity of demand of 0.2, B has an elasticity of demand of 0.8, C has an elasticity of demand of 1.0, and D has an elasticity of demand of 2.0. The group paying the highest price for
the product will be A) A. B) B. C) C. D) D.
If the opportunity costs of producing a good increase as more of that good is produced, the economy's production possibility frontier will be
A. a negatively sloped straight line. B. negatively sloped and "bowed inward" toward the origin. C. negatively sloped and "bowed outward" from the origin. D. a positively sloped straight line.