Which of the following conditions would result in the short run marginal cost curve not correctly reflecting the supply behavior of a profit maximizing firm?
a. The firm is a price taker.
b. Price exceeds average total cost.
c. The elasticity of demand facing the firm is ?3.
d. the firm can vary several inputs in the short run.
c
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In terms of the Phillips curve, the experience of the 1970s indicates that macro-policy
a. can permanently reduce unemployment if we are willing to tolerate higher inflation. b. can reduce unemployment in the long run if we are willing to tolerate higher inflation. c. may be able to reduce unemployment but cannot retard inflation. d. may be able to reduce unemployment in the short run, but there is little evidence that expansionary policies can reduce unemployment permanently.
According to the quantity theory of money, velocity:
A. varies with changes in the growth rate of the money supply. B. varies substantially with changes in the rate of interest and the expected rate of inflation. C. is virtually constant, responding only to changes in the underlying institutional structure. D. is fairly constant, responding only to changes in the expected rate of inflation.
?An increase in government purchases must always be accompanied by an increase in autonomous net taxes to boost aggregate demand.
a. True
b. False
Indicate whether the statement is true or false
________ is (are) estimated at approximately $100 billion per year.
A. The value of brain drain flowing into the United States B. Remittances sent from developed countries to less developed countries C. Capital flight from the United States D. Social overhead capital in the United States