What does limited liability mean?
A) The personal assets of the owners cannot be claimed if the business is bankrupt.
B) Anybody with a liability against a firm can claim only what their liability refers to.
C) The owners of the business are personally responsible for paying expenses incurred by the business.
D) Only employees can have a claim on the assets of the business.
A
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The rate at which prices in general are increasing is called:
A. the unemployment rate. B. the inflation rate. C. the trade balance. D. the standard of living.
The most appropriate countercyclical policy, or stabilization policy, in times of unemployment, according to classical economists, is for the government to:
a. increase the minimum wage. b. impose wage and price controls. c. stimulate aggregate demand. d. cut taxes. e. do nothing.
Which of the following best represents the consumption function?
A) consumption = autonomous consumption + (the marginal propensity to consume × disposable income) B) consumption = disposable income - (autonomous consumption / the marginal propensity to consume) C) consumption = disposable income × (1 / 1 - the marginal propensity to consume) D) consumption = autonomous consumption + (the marginal propensity to consume × transfer payments) / disposable income
Firm A producing one good acquires another firm B producing another good. The cross price elasticity of demand for the goods owned by each firm is 2.6 . Holding other things constant, the acquiring firm should
a. Raise prices on both goods b. Lower prices on both goods c. Raise price on the acquired good only d. Need more information