The difference between current market price and full costs of production for the firm is known as
A. producer surplus.
B. nonprice surplus.
C. consumer surplus.
D. market surplus.
Answer: A
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Workers should invest in additional human capital as long as the:
A. marginal benefit exceeds the marginal cost. B. opportunity cost exceeds the marginal benefit. C. opportunity cost is zero. D. marginal cost exceeds the marginal benefit.
For any new deposits into the banking system, the deposit expansion multiplier provides
A) no useful information regarding the potential expansion of the nation's money supply. B) an exact prediction of the expansion of the nation's money supply. C) a theoretical limit on the potential expansion of the nation's money supply. D) an argument that deposits don't effect the nation's money supply at all.
Adaptive expectations is a school of thought that argues people form expectations based on all available information, including the likely future actions of government policy makers
a. True b. False Indicate whether the statement is true or false
The example of an inflationary gap in 2006-2007 suggested that the economy adjusts
a. rapidly to inflationary gaps by lowering prices. b. rapidly to inflationary gaps by raising prices. c. slowly to inflationary gaps by lowering prices. d. slowly to inflationary gaps by increasing inflation.