Does the proprietor of a grocery store who owns the building in which his business is located have lower costs than a grocery store proprietor who must pay rent for the building in which his store is located?
A) No, because no two businesses will be exactly the same.
B) No, because the owner-proprietor loses the rent he could otherwise have been paid.
C) Yes, because he can afford to set lower percentage markups.
D) Yes, if the cost saving is not offset by higher expenses in other areas.
B
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Which of the following statements is true about a simple circular flow model?
A) Producers are buyers in the factors market. B) Producers are neither buyers nor sellers in the product market. C) Households are neither buyers nor sellers in the input market. D) Households are sellers in the product market.
Classical economists believe that when the aggregate supply curve is horizontal, monetary policy and fiscal policy will have no effect on real output.
Answer the following statement true (T) or false (F)
In Figure 27.2, profit regulation will lead the natural monopoly to produce
A. QB and charge PB. B. QC and charge PD. C. QA and charge PA. D. QC and charge PC.
As the price level in the economy increases, which of the following sequence of events occurs?
A) Md? r? I? AE? B) Md? r? I? AE? C) Md? r? I? AE? D) Md? r? I? AE?