One aggregates individual demand curves by adding
A. vertically.
B. horizontally and subtracting vertically.
C. horizontally.
D. vertically and subtracting horizontally.
Answer: C
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If a firm hires lazy employees,
A) it must pay them differently or hard-working employees will engage in moral hazard. B) it must pay them more or hard-working employees will engage in moral hazard. C) it must fire them before their laziness spreads to hard-working employees. D) the lazy employees make hard-working employees look good.
Crowding out can be avoided temporarily if the government's debt is internationalized.
Answer the following statement true (T) or false (F)
The equilibrium price and quantity in Figure 3.2 are, respectively,
Figure 3.2 Supply and Demand
A. $12 and 40 units. B. $12 and 20 units. C. $9 and 30 units. D. $6 and 20 units.
Firms like to know the price elasticity of demand because it determines how price changes affect:
A. the supply curve. B. costs. C. revenues. D. taxes.