When the market for a good is in equilibrium,
a. consumer surplus will equal producer surplus.
b. the total value created for consumers will equal the total cost of production for business firms.
c. all units valued more highly than the opportunity cost of production will be supplied.
d. all units that have value will be produced, regardless of their cost of production.
C
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When the Fed increases the federal funds rate,
A) there is no effect on investment because investment depends on the real interest rate. B) the real interest rate falls, and investment increases. C) the real interest rate rises, and investment decreases. D) the real interest rate is unaffected, but investment still decreases. E) the real interest rate rises, and investment does not change.
The total of all economic transactions between a nation and the rest of the world is referred to as the
A) balance of payments. B) balance of trade. C) balance of power. D) exchange rate.
Economists call a severe prolonged economic recession a:
a. slump. b. depression. c. stagnation. d. stagflation. e. trend.
A firm sells in a competitive market in which price is $12 . Its marginal cost is 6 + .25Q. Determine the profit-maximizing level of output