By and large, the price of each item on a restaurant menu is:
A) an accurate reflection of the item's marginal cost.
B) based strictly on consumer demand.
C) a function of cost and the price elasticity of demand for the item.
D) a fixed multiple of the item's total cost.
C
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Because the United States is highly integrated with the international capital market, international capital flows tend to
a. counteract the negative effect on aggregate demand of lower interest rates. b. counteract the positive effect on aggregate demand of higher interest rates. c. strengthen the negative effects on aggregate demand of higher interest rates. d. strengthen the negative effects on aggregate demand of lower interest rates.
If, in a given market of multiple producers, there is a positive gap between price and average cost (P > AC) for an extended period of time, this would suggest that
A. there are many sellers in the industry. B. there exists an oligopoly or cartel in the industry. C. this is a contestable market. D. the firm cannot be a monopolistic competitor.
As long as two people have different opportunity costs, each can gain from trade with the other, since trade allows each person to obtain a good at a price lower than his or her opportunity cost
a. True b. False Indicate whether the statement is true or false
The national debt is the amount
A) by which government outlays exceed tax revenue in a given year. B) by which government tax revenue exceed outlays in a given year. C) of government outlays summed over time. D) of debt outstanding that arises from past budget deficits. E) of all future entitlement spending.