All else equal, the flatter the marginal cost curve, the ________ sensitive quantity produced is to changes in demand and, thus the ________ valuable an accurate forecast is to the firm.
A) more; more
B) more; less
C) less; more
D) less; less
A) more; more
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Use the following diagram to answer the next question.
We observe that the economy has moved from NX1 to NX3. This could have happened because ________.
A. imports decreased B. exports increased by more than imports C. exports increased by less than imports D. exports increased
A monopolistic competitor, like a(n) ____________, faces a downward-sloping demand curve.
a. monopolist b. perfect competitor c. oligarch d. new entrant
A $5 billion cut in government purchases caused real GDP in the economy to decrease by $12.5 billion. The MPC for this economy is
A. 0.6. B. 0.9. C. 0.8. D. 0.75.
Under the rational expectations hypothesis, if wages adjust rapidly to new information about intended policy actions, the only time that changes in government policies have real effects is when
A. the changes affect aggregate demand. B. the changes involve monetary policy. C. the changes are unanticipated. D. the changes involve fiscal policy.