If MUx/Px exceeds MUy/Py, then a household can increase its utility by spending more on Y and less on X.
Answer the following statement true (T) or false (F)
False
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Unlike a firm in pure competition, a monopolist may be able to
a. block the entry of new firms into the industry. b. continue to earn economic profits in the long run. c. earn economic profits in the short run. d. both block the entry of new firms into the industry and continue to earn economic profits in the long run.
Suppose there are only two goods in the world, corn and shirts. If it is true that with its vast resources the United States could produce both more corn and more shirts than Mexico,
a. Mexico will never have a comparative advantage and, thus, can never gain from trading with the United States. b. trade between the United States and Mexico will make the United States better off but will leave Mexico worse off unless the wage of workers in Mexico rises to equal that of American workers. c. total production of corn and shirts cannot be increased through specialization and trade. d. both countries will be able to gain from specialization and trade as long as relative costs of producing the two goods are different in Mexico than in the United States.
In order to reduce the U.S. debt,
A. The government should spend less than it collects in tax revenues. B. Foreign governments must lend more money to the U.S. government. C. The government must use deficit spending. D. There will be a transfer of revenue from bondholders to taxpayers.
The short-run aggregate supply curve is most likely to shift down (to the right) if:
A. input prices fall. B. productivity falls. C. sales taxes increase. D. wages rise.