Sue's Sea Shells by the Sea Shore is a perfectly competitive firm selling sea shells at the market price of $2 per dozen. Sue's Sea Shells by the Sea Shore has fixed costs of $40 per day and a variable cost schedule in the table above
The profit-maximizing level of output for Sue's Sea Shells by the Sea Shore is A) 202 dozen sea shells by the sea shore per day.
B) 204 dozen sea shells by the sea shore per day.
C) 205 dozen sea shells by the sea shore per day.
D) 206 dozen sea shells by the sea shore per day.
B
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The decisions of firms and households are
A) coordinated by but not totally controlled by the government. B) made independently of one another. C) controlled by but not totally coordinated by the government. D) coordinated by markets. E) unexplainable by the circular flow model.
Which of the following has been a problem faced by the FDIC in its provision of federal deposit insurance?
A) a relatively low number of bank failures each year, which has reduced the need for deposit insurance B) moral hazard arising from the tendency for the highest-risk banks to be those most interested in obtaining deposit insurance in the first place C) adverse selection arising from the tendency for banks to take on more risk after they receive deposit insurance D) moral hazard arising from the tendency for banks to take on more risk after they receive deposit insurance
If the price level doubles, the value of money
A) doubles. B) more than doubles, due to scale economies. C) rises but does not double, due to diminishing returns. D) falls by 50 percent.
All of the following arguments are presented in favor of inflation targeting EXCEPT
A) it would draw attention to what the central bank can achieve in practice. B) it would provide an anchor for inflationary expectations. C) it would promote accountability by providing a yardstick by which policy can be measured. D) it would reduce the lags inherent in monetary policy.