What happens to the Phillips curve when future inflation is expected to rise?
A. The curve shifts to the right.
B. The curve becomes horizontal.
C. The curve shifts to the left.
D. The Phillips curve is unaffected.
Answer: A
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A profit-maximizing monopolistic competitor continues production until ________
A) marginal revenue exceeds marginal cost B) marginal revenue equals marginal cost C) marginal revenue exceeds average revenue D) marginal revenue equals average revenue
Returns to scale refers to the change in output when
A) all inputs increase proportionately. B) labor increases holding all other inputs fixed. C) capital equipment is doubled. D) specialization improves.
A monopoly has
a. A perfectly elastic demand curve b. A perfectly elastic supply curve c. An inelastic demand curve d. A less elastic demand curve than a competitive firm
Use the following general linear supply function:Qs = 40 + 6P - 8PI + 10F where Qs is the quantity supplied of the good, P is the price of the good, PI is the price of an input, and F is the number of firms producing the good. If PI = $20, F = 60, and the demand function is Qd = 600 - 6p the equilibrium price and quantity are, respectively,
A. P = $8 and Q = 326. B. P = $10 and Q = 540. C. P = $8 and Q = 640. D. P = $10 and Q = 640. E. none of the above.