The return to any factor of production that is in fixed supply is
A. producer surplus.
B. factor surplus.
C. pure profit.
D. pure rent.
Answer: D
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A buyer is said to have a demand for a good only when
A. The buyer is not willing to buy the good and does not have enough income to purchase the good. B. The buyer has the income but the good is not preferred. C. The buyer is both willing and able to purchase the good. D. An adequate supply of the good is available for purchase.
Answer the following statements true (T) or false (F)
1. In real-business-cycle theory, real output can change without a change in the price level. 2. A coordination failure is said to occur when people do not reach a mutually beneficial equilibrium because they lack some way to jointly coordinate their actions to achieve it. 3. New classical economists see the economy as incapable of self-correction when disturbed and pushed away from its full-employment level of real output. 4. Rational expectations theory assumes that both product and resource markets are competitive and that wages and prices are flexible. 5. In rational expectations theory, a fully anticipated change in aggregate demand or in the price level results in no change in real output.
The current deregulatory movement began to change laws to deregulation in the
a. early 1970s. b. late 1970s. c. early 1980s. d. early 1990s.
When the official dollar price of a foreign currency is set below its equilibrium level, the foreign currency
A) has been depreciated. B) is overvalued. C) is undervalued. D) is devalued. E) is revalued.