Economic theory explains the process of "economizing", which is the process of
What will be an ideal response?
allocating scarce resources in a way that offers from them the most of what the economizer wants.
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In the short run, each perfectly competitive firm is free to
a. increase its plant size. b. increase its volume of output up to its maximum existing capacity. c. charge a price above the market price. d. do all of these.
If prices increase rapidly
A) money's usefulness as a store of value is diminished. B) money increases in value. C) deflation is likely. D) prices will decline to their normal level.
The proportion of domestic demand for a good that is satisfied by domestic production relative to that supplied by imports is determined by:
a. the interplay of domestic demand and supply curves and the domestic equilibrium price of the good. b. the interplay of demand and supply curves in the international market and the international equilibrium price of a good. c. domestic supply and demand curves and the international equilibrium price of a good. d. the different trade restrictions like tariffs and quotas created by the domestic government. e. the interplay of demand and supply curves in the international market and the domestic price of the good
What will be the effects of a decrease in government spending?
a. an increase in equilibrium GDP, a decrease in money demand, a decrease in the interest rate, and an increase in investment spending b. a decrease in equilibrium GDP, a decrease in money demand, an increase in the interest rate, and a decrease in investment spending c. an increase in equilibrium GDP, an increase in money demand, an increase in the interest rate, and an increase in investment spending d. a decrease in equilibrium GDP, a decrease in money demand, a decrease in the interest rate, and an increase in investment spending e. an increase in equilibrium GDP, an increase in money demand, an increase in the interest rate, and a decrease in investment spending