Inflationary recessions
A. cannot possibly occur.
B. have not occurred over the last 50 years.
C. are easily dealt with by conventional monetary and fiscal policies.
D. have occurred during 1970's and 1980's.
D. have occurred during 1970's and 1980's.
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Use the following cost table to answer the next question.OutputAverage Variable CostAverage Total CostMarginal Cost0---2$2.50$27.50$2.542.0014.501.562.0010.332.082.138.382.5102.307.303.0122.506.673.5143.006.576.0164.007.1311.0The table shows cost data for a perfectly competitive firm. If the market price for the firm's product is $6, what output level will the firm produce to maximize profits?
A. 16 B. 12 C. 0 D. 14
Why does the money supply increase when the Fed buys a bond but does not change when a business buys a bond?
What will be an ideal response?
Some economists have suggested that network externalities result in consumers being locked into the use of products with inferior technologies
Economists Stan Leibowitz and Stephen Margolis have studied cases that have been cited as examples of this and found A) that consumers use products with inferior technologies when their prices are lower than products with superior technologies. B) that in all of these cases network externalities resulted in market failure. C) there is no convincing evidence that the alternative technologies were superior. D) consumers sometimes do become locked into the use of products with inferior technologies.
If a rapid disinflation has a lower sacrifice ratio than a slow disinflation, then reducing inflation is best accomplished by
A) gradualism. B) increasing money growth. C) reducing interest rates. D) a cold-turkey approach.