The random walk theory says that
A) stock prices follow a trend for varying periods of time.
B) successive stock prices increase more than they decrease.
C) successive stock prices are dependent on the weighted average of the previous week's prices.
D) successive stock prices are independent of each other.
D
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Refer to Figure 7.1. In equilibrium, the real wage is ________ and the amount of labor employed is ________
A) Y; B B) X; C C) Y; C D) Z; C
I + (G – T) =
a. S + M b. S + X c. S + (M - X) d. S + (I - M)
One prediction about monopolistic competition is that it has higher unit costs than perfect competition. But it is unreasonable to conclude that monopolistic competition is therefore bad for consumers because
A) consumers benefit from an increased variety of products. B) higher production costs means more employment. C) consumers benefit from products becoming more homogeneous. D) consumers benefit from lower prices. E) consumers benefit because of an increase in quantity available.
If production of an item results in negative external costs, then
A. the market quantity is too low from society's point of view. B. the market price is below the socially preferred price that reflects the external costs. C. the market price is above the socially preferred price that reflects the external costs. D. market forces will always correct the problem.