If the shopkeeper goes first and quotes a high price, what is the best response of the customer?
a. Accept the high price
b. Yell at the store owner
c. Walk away from the deal
d. Swear off shopping forever
a
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An increase in government purchases must always be accompanied by an increase in autonomous net taxes to boost aggregate demand
a. True b. False Indicate whether the statement is true or false
If you want to deflate the current price of something to eliminate the effect of inflation,
a. divide the number by the price index. b. multiply the number by the price index. c. multiply the number by 2 and then divide by the price index. d. multiply the number by the price index and then divide by 2.
Which of the following examples most accurately reflects a perfectly competitive market?
a. The raspberry market has about 50 large producers. b. The strawberry market has about 100 small producers. c. The pear market has about 1,000 large producers. d. The peach market has about 10,000 small producers.
Exhibit 7-13 Price and cost per unit curves
?
In Exhibit 7-13, if the price is P3, the firm will
A. produce Q3 and earn an economic profit. B. produce Q3 and incur a loss in the short run. C. produce Q3 and earn zero economic profit. D. decide not to produce any output to minimize the loss.