Which of the following statements is correct?
a. A general, persistent decline in stock prices may signal that the economy is about to enter a boom period because people will be able to buy stock for less money.
b. A general, persistent decline in stock prices may signal that the economy is about to enter a recession because low stock prices may mean that people are expecting low corporate profits.
c. A general, persistent decline in stock prices may signal that the economy is about to enter a recession because low stock prices mean that corporations have had low profits in the past.
d. Expectations about the business cycle have no impact on stock prices.
Answer: b. A general, persistent decline in stock prices may signal that the economy is about to enter a recession because low stock prices may mean that people are expecting low corporate profits.
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In this graph for positive externalities in consumption, the deadweight loss is caused by ______.
a. government intervention
b. defective products
c. overproduction
d. underproduction
In the table at? right, how many workers are employed when marginal product reaches its? maximum?
A. 1
B. 3
C. 4
D. 2
Which of the following has been an outcome of the North American Free Trade Agreement (NAFTA)?
A. A lower standard of living in Canada, Mexico, and the United States. B. Lower wages in the United States and Canada. C. Increased trade among Canada, Mexico, and the United States. D. Lower wages and reduced employment in Mexico.
While price discrimination is possible between two markets, it is not possible in more than two
Indicate whether the statement is true or false