If Claire's reservation price on a sweater is $37, which of the following prices would she have to observe in the market in order to buy a sweater?
A. $37.01
B. $38.00
C. $37.00
D. Claire would not buy a sweater at any of these prices.
C. $37.00
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According to this Application, the Fed increased its lending by hundreds of billions of dollars to financial institutions as a response to the ongoing financial crisis
This increase in loans to financial institutions increased the supply of money in the economy. When the supply of money increases, the money supply curve will A) shift to the right, increasing the interest rate. B) shift to the left, increasing the interest rate. C) shift to the right, decreasing the interest rate. D) shift to the left, decreasing the interest rate.
Which of these policy rule variables does NOT have the disadvantage of being hard to control?
A) nominal GDP growth B) high-powered money C) the unemployment rate D) the inflation rate
Transforming the tax base of an income tax by subtracting savings has the advantage that _____
a. a progressive rate structure can be applied to a consumption tax b. all income can be taxed at a flat rate c. it double taxes income d. it guarantees progressivity
Consider a monopolist which sells output in two markets, the home market and the foreign market. Initially the monopolist is unable to price discriminate and sets a single price for both markets
However, the demand in the foreign market is such that at the price the monopoly sets, no goods are sold in the foreign market. If the monopolist is then able to price discriminate, will the overall deadweight loss increase or decrease? Explain.