Economists have found that firms are
A) less likely to change prices as a result of shocks to the aggregate economy than shocks limited to the firm's particular sector.
B) more likely to change prices as a result of shocks to the aggregate economy than shocks limited to the firm's particular sector.
C) equally likely to change prices as a result of shocks to the aggregate economy as they are shocks limited to the firm's particular sector.
D) unlikely to change prices as a result of both shocks to the aggregate economy and shocks limited to the firm's particular sector.
A
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To John Maynard Keynes, investment demand depends less upon the availability of saving than upon the profit expectations of producers
Indicate whether the statement is true or false
Two currencies existed in Iraq before the U.S. invasion and subsequent conflict. What lessons are there for students of exchange rates?
a. Exchange rate values are influenced not only by economic fundamentals but by political events that change long-run expectations of future currency values. b. Iraq did not back its currency with gold and, therefore, it was worth much less than the U.S. dollar. c. Eventually, each Iraqi sect developed its own currency and payments system. d. Exchange rate values are solely influenced by economic policy.
The amount by which consumption increases when after-tax income increases by $1 is called the:
A. marginal propensity to consume. B. consumption multiplier effect. C. marginal consumption revenue. D. variable propensity to consume.
The government weighs the potential cost savings resulting from a merger against the potential anticompetitive problems to determine whether or not to allow a merger to take place.
Answer the following statement true (T) or false (F)