A monopolist faces a demand curve given by P = 60 -2Q and has total costs given by TC = Q2. Its marginal revenue is MR = 60 - 4Q and its marginal cost is MC = 2Q. In autarky, what is the firm's equilibrium output?
a. 5
b. 10
c. 15
d. 20
Ans: b. 10
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Which of the following functions of money would be violated if inflation were high?
a. unit of account b. store of value c. certificate of gold d. medium of exchange
The demand for dollars is downward sloping because when dollar value rises,
a. Foreigners demand more of US goods and services b. Foreigners demand less of US goods and services c. Foreigners demand more dollars d. It does not depend on the dollar value
An example of stimulus spending by the government might be:
A. increase in government purchases of new cars. B. the monthly payments a government agency makes to its employees. C. a cut in the government budget aimed at spurring private consumption. D. the FED engaging in open market sales of securities.
A reduction in the rate of inflation would be
A. deflation. B. hyperinflation. C. disinflation. D. crawling inflation.