The use of surveys of experts to estimate long-run production costs may be undermined by the fact that:
A) it is a time-consuming process.
B) it is dependent on the judgments of individuals closely connected with the industry.
C) reporting biases can occur.
D) all of the above.
D
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If a positive permanent supply shock were to occur, the resulting equilibrium would be a:
A. higher level of output at lower prices. B. lower level of output and prices. C. higher level of output and prices. D. lower level of output at higher prices.
You are a hotel manager and you are considering four projects that yield different payoffs, depending upon whether there is an economic boom or a recession. The potential payoffs and corresponding payoffs are summarized in the following table. ProjectBoom (50%)Recession (50%)A$20-$10B-$10$20C$30-$30D$50$50A risk-neutral manager will prefer project:
A. A. B. B. C. C. D. D.
Identify the correct statement with respect to consumption and saving function
a. Both the consumption function and the saving function have negative slopes. b. As disposable income declines, consumption and saving increase. c. The consumption function has a negative slope while the saving function has a positive slope. d. As disposable income rises, consumption and saving increases. e. The consumption function has a positive slope while the saving function has a negative slope.
Refer to the information provided in Figure 26.2 below to answer the question(s) that follow.
Figure 26.2Refer to Figure 26.2. Between the output levels of $600 billion and $900 billion, the relationship between the price level and output is
A. positive. B. constant. C. negative. D. There is no relationship between the price level and output.