The study of how a particular firm might choose to maximize its profits would fall into what type of analysis?
A. aggregate economics
B. macroeconomics
C. political economics
D. microeconomics
Answer: D
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In the presence of a negative externality
a. there is an overallocation of resources to production b. the competitive equilibrium will not achieve an allocatively efficient solution c. MSC exceeds MSB at the competitive output level d. all of the above e. (a) and (b) only
Which of the following is true of a covered bond?
A. In case of covered bonds, the obligation of the loan remains with the originating bank that gives out the loan. B. In case of covered bonds, the obligation of the loan immediately transfers to the institution taking the loan. C. A covered bond is the same as a mortgage-backed security except that it is more popular in the United States than in Europe. D. A covered bond is the same as a mortgage-backed security except that it is more popular in the Europe than in the United States.
Because the personal income tax is an automatic stabilizer,
A. inflationary gaps are impossible. B. the budget deficit grows during a recession. C. the deficit needed to cure a recessionary gap increases. D. the structural deficit grows during a recession. E. all of the above are correct.
How does the equilibrium quantity traded change when there is an increase in supply and a decrease in demand?