Using time-series data, the demand function for a profit-maximizing monopolist has been estimated asQd = 142,000 - 500P + 6M - 400PRwhere Qd is the amount sold, P is price, M is income, and PR is the price of a related good. The estimated values for M and PR in 2012 are $25,000 and $200, respectively. The short-run marginal cost curve for this firm has been estimated as:MC = 200 - 0.024Q + 0.000006Q2Total fixed cost is forecast to be $500,000 in 2016.What is the optimal price?
A. This is irrelevant since the firm will not produce in the short run.
B. $520
C. $200
D. $408
E. $250
Answer: D
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Which of the following is not a reason for the establishment of intergovernmental transfer programs?
a. Higher level governments want to encourage lower governments to undertake certain programs. b. Taxes are harder to avoid at higher levels of government. c. To provide for national defense resources utilized at the local level. d. Equalization of resources between richer and poorer localities
Which of the following is an example of a normative statement? a. The GDP growth rate has been unstable over five years
b. The tax rate should be reduced to improve the quality of life in an economy. c. The unemployment rate has been below the natural rate of unemployment in the U.S for the last 2 years. d. The inflation rate of 2015 exceeds the inflation rate of 2014.
If the representatives of the OPEC countries decided to increase the quotas of oil each country are allowed to produce, the result would be that
A. the world demand for oil would fall. B. the world supply of oil would fall. C. the world demand for oil would rise. D. the world supply of oil would rise.
Everything else held constant, increased demand for a country's exports causes its currency to ________ in the long run, while increased demand for imports causes its currency to ________
A) appreciate; appreciate B) appreciate; depreciate C) depreciate; appreciate D) depreciate; depreciate