The difference between a monopsonist's marginal expenditure and that of a price taker is:
A. the marginal cost of the input.
B. the input expansion effect.
C. the price increase effect.
D. the marginal substitution effect.
C. the price increase effect.
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There is no evidence that odd pricing succeeds in convincing consumers that prices are lower than they really are
Indicate whether the statement is true or false
Suppose that for each automobile Japan produces it must forego producing 40 computers. The United States must forego producing 80 computers for each automobile it produces. Which of the following is true?
a. Japan has a comparative advantage in producing computers. b. the U.S. has a comparative advantage in producing computers. c. the U.S. has a comparative advantage in producing automobiles. d. the U.S. has an absolute advantage in producing automobiles. e. the opportunity cost of producing computers is the same for Japan and the U.S.
All inputs are increased by the same proportion and the output increases more than proportionately, this suggests that:
(a) Constant returns to scale are present. (b) Increasing returns to scale are present. (c) Decreasing Returns to Scale. (d) None of the above.
If planned aggregate spending in an economy can be written as PAE = 15,000 + 0.6Y ? 20,000r, and potential output equals 34,000, what real interest rate must the Federal Reserve set to bring the economy to full employment?
A. 3 percent B. 7 percent C. 6 percent D. 5 percent