A household will buy a good as long as the
A. marginal utility from its consumption is greater than or equal to its market price.
B. good's price is greater than the maximum a consumer would be willing to pay for it.
C. good's use value is less than the price being charged for the good.
D. good still provides the consumer with average utility.
Answer: A
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The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment. B. exogenous spending. C. recessionary gaps. D. expansionary gaps.
Which of the following is a possible consequence if a contractionary monetary policy is adopted?
A) The demand for labor will increase. B) The aggregate price level will rise. C) Real output will increase if nominal wages are fixed. D) Real wages will increase if nominal wages are fixed.
A normative statement
A) depends on someone's values. B) cannot use the word "should." C) says what is currently believed about the way the world operates. D) must be tested to determine if it is correct. E) can be tested to determine if it is correct.
Because people prefer name-brand pain-relieving drugs over store-brand pain-relieving drugs, demand curves do not slope downward for pain-relieving drugs
Indicate whether the statement is true or false