Which of the following describes the difference between the market demand curve for a perfectly competitive industry and the demand curve for a firm in this industry?
A) The market demand curve is a horizontal line; the firm's demand curve is downward sloping.
B) The market demand curve is downward sloping; the firm's demand curve is a vertical line.
C) The market demand curve can not have a constant slope; the firm's demand curve has a slope equal to zero.
D) The market demand curve is downward sloping; the firm's demand curve is a horizontal line.
Answer: D
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If aggregate expenditure in an economy equals 3,000 + 0.75Y and full employment real GDP equals 12,000, then this economy has
A. no autonomous expenditure. B. a recessionary gap. C. an inflationary gap. D. no output gap.
The Federal Open Market Committee (FOMC)
A. provides advice on banking stability to the Fed. B. follows the actions and operations of financial markets to keep them open and competitive. C. sets policy on the sale and purchase of government bonds by the Fed. D. monitors regulatory banking laws for member banks.
Which of the following correctly describes the trend in the federal budget during the 1980s?
a. Federal spending declined relative to GDP, while federal revenues rose relative to GDP. b. Federal spending rose relative to GDP, while federal revenues declined relative to GDP. c. Balanced budgets were passed though cooperation between the president and Congress. d. The dollar depreciated, thereby lowering the deficit.
Which of the following will likely occur when price floors in agriculture are implemented?
A) Quantity supplied will exceed quantity demanded. B) Quantity demanded will exceed quantity supplied. C) Farmland will be underutilized. D) Supply will decrease.