For a firm in a perfectly competitive market, a price decrease:
A. lowers the profit-maximizing quantity.
B. is unrelated to the profit-maximizing quantity.
C. increases the profit-maximizing quantity.
D. signifies the firm should leave the market.
Answer: A
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When a nation exports a good, its total surplus ________, and when it imports a good, its total surplus ________
A) increases; increases B) decreases; decreases C) increases; decreases D) decreases; increases E) does not change; does not change
The most important economic benefit from specialization is that it
A) makes it possible for an economy to begin using money. B) leads to an increase in the standard of living in an economy. C) makes barter possible. D) eliminates the need for financial markets.
If the social cost is greater than the private cost in a particular market, the socially optimal equilibrium will be at a quantity:
A. greater than the private level. B. equal to the private level. C. greater than or less than the private level, depending on the size of the external costs. D. less than the private level.
Dr. Smith on the Channel 6 news says, "The recent figures showing that the unemployment rate is lower this quarter than last quarter are a definite sign that our economy is coming out of the recession." Dr. Jones on the Channel 8 news says, "Recent figures showing that employment is lower this quarter than it was last quarter are a definite sign that our economy is still plunging deeper into the
recession." a. Is it possible for both unemployment and employment to fall at the same time? What factor could account for the observed phenomenon? b. In light of your answer, what do you think about the health of the economy relative to last quarter?