Why would a firm price discriminate? Because price discrimination allows the firm to
a. increase consumer surplus
b. create brand multiplication
c. select the best consumers who are willing to pay the highest price
d. convert consumer surplus into economic profit
e. shift its demand curve to the right
D
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Most economists believe that the CPI overstates the actual changes in prices while the chain index for GDP understates them
Indicate whether the statement is true or false
Which policy tool allows the Federal Reserve the greatest control over monetary policy?
A) the reserve requirement B) open market operations C) lender of last resort D) the discount rate
The Federal Reserve issues a report indicating that future inflation will be higher than had previously seemed likely. As a result
A) the supply curve for bonds shifts to the right. B) the demand curve for loanable funds shifts to the left. C) the equilibrium interest rate falls. D) the equilibrium price of bonds rises.
The marginal physical product of labor is
A) the output of the firm divided by the number of workers. B) the change in total revenues resulting from the addition of one more worker, while increasing one other factor of production. C) the change in output resulting from the addition of one more worker, holding other factors of production constant. D) the change in output resulting from the addition of one more worker, adjusting the level of the capital stock accordingly.