The opportunity cost of holding money is the
A) nominal interest rate on assets other than money.
B) price of goods and services.
C) level of wage and rental income.
D) ease with which an asset can be converted into a means of payment.
A
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The quantity of goods exchanged in a market will be below the equilibrium quantity
A. when the price is either held above or below the equilibrium price. B. only when the price is held above the equilibrium price. C. only when the price is held below the equilibrium price. D. only when the price is rising.
Which of the following statements is TRUE about the market demand curve for labor?
A) The market demand curve is the sum of the individual firm's demand curve. B) The market demand curve will be perfectly inelastic since firms need labor. C) The market demand curve shows the quantities of labor demanded by all firms in the industry at various marginal products. D) The market demand curve depends upon labor productivity, the wage rate and the price of the final product.
The labor supply curve faced by an individual firm in a perfectly competitive market is
A) upward sloping. B) horizontal. C) vertical. D) downward sloping.
An article in The Economist reported that prices of CDs in Britain was much higher than prices in the United States or other European countries. There were only a few major companies, and a report from a Parliament committee said there was no serious price competition. The best explanation for this is that
a. the industry was a contestable market. b. there were entry barriers in production and distribution of CDs. c. firms were avoiding profit opportunities. d. there were substantial differentiation of product.