Purchasing power parity can be used as
A) a long-run gauge, but in the short run large deviations in currency values can exist.
B) a short-term gauge, but in the long run large deviations in currency values can exist.
C) an indicator of how interest rates will change in the short run.
D) an indicator of how interest rates will change in the long run.
E) a short-term and long-term gauge of relative currency values.
A
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If there are eight firms in a market and each has an equal market share, the Herfindahl-Hirschman Index (HHI) is ________ and the market is considered to be ________.
A) 1,250; moderately competitive B) 2,800; moderately competitive C) 1,250; competitive D) 2,800; competitive
The supply of loanable funds curve is
a. upward sloping because fewer people are persuaded to forgo current consumption as the interest rate rises b. downward sloping, showing that more investment will be undertaken as inflation decreases c. upward sloping because the opportunity cost of goods and services that must be forgone increases d. downward sloping, showing that as more funds are made available, the risk cost of loaning funds decreases e. usually horizontal
At the level of output where the marginal cost and marginal revenue curves intersect, a monopolist's demand curve passes above its average total cost curve. The firm will:
a. be able to make a pure economic profit. b. stay in operation in the short-run, but shut down. c. shut down in the short-run. d. increase its price.
Diminishing marginal utility is best illustrated by which of the following statements?
a. A decrease in the price of hot dogs will cause consumers to buy more hot dogs, because the lowered price has increased their effective real income. b. A person will receive less satisfaction from consuming four hot dogs than from consuming three hot dogs. c. A person will receive less added satisfaction from consuming a fourth hot dog in a week than from consuming the third hot dog in a week. d. If the price of hot dogs declines, people's tastes for hot dogs will increase.