If firms are producing at a profit-maximizing level of output where the price exceeds the average total cost:
A. other firms will exit the market.
B. accounting profits must be positive, but economic profits are zero.
C. firms will exit the market.
D. economic profits must be positive.
Answer: D
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In the foreign exchange market, an increase in the world demand for U.S. exports shifts the
A) demand curve for U.S. dollars rightward. B) demand curve for U.S. dollars leftward. C) supply curve for U.S. dollars leftward. D) supply curve for U.S. dollars rightward.
Tax incidence most accurately refers to
A. The taxes paid divided by taxable income. B. Those from whom a tax is collected. C. The relative tax burdens of state and local governments. D. The distribution of the real burden of a tax.
When the housing bubble popped, the effect of the negative demand side shock and the negative supply side shock were the same on:
A. output, causing it to definitely decrease. B. prices, causing them to definitely rise. C. output, causing it to definitely increase. D. prices, causing them to definitely fall.
In what way are other assets less liquid than money?
What will be an ideal response?