A low rate of expected inflation tends to lead to a ________ rate of actual inflation and a high rate of expected inflation tends to lead to a ________ rate of actual inflation.
A. low; high
B. low; low
C. high; low
D. high; high
Answer: A
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Marginal cost ________ as the quantity produced is increased
A) first increases and then decreases B) first decreases and then increases C) always increases D) always decreases
Suppose the demand for pizza in a small isolated town is p = 10 - Q. There are only two firms, A and B, and each has a cost function TC = 2 + Q
Compare the firms' profits if they behave as Cournot duopolists with their profits if they form a cartel and share the market.
In the short run, if a firm shuts down, its total revenue is
a. $0 b. equal to its fixed costs c. greater than its variable costs d. greater than its fixed costs e. less than its variable costs
In contrast to other antipoverty programs, a negative income tax
a. provides incentives to work b. provides more assistance to children c. assists the unemployed d. provides direct in-kind transfers to the most needed e. recognizes the existence of a culture of poverty