Refer to Figure 12-5. If the market price is $20, what is the firm's profit-maximizing output?
A) 750 units B) 1,100 units C) 1,350 units D) 1,800 units
C
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"Although the United States is running a large current account deficit, it is still ranked as a major international net lender." Is the previous statement correct or incorrect? Briefly explain your answer
What will be an ideal response?
Ocean Spray is considered to be an oligopoly firm because, until the 1990s, it faced little competition in the market for fresh and frozen cranberries. Why?
A) Ocean Spray had a patent on the production of cranberries that gave the company the exclusive right to market its product for 20 years. The 20-year period ended in the 1990s. B) The federal government imposed a high tariff on cranberry imports. During the 1990s the tariff was eliminated, but Ocean Spray still controls about 80 percent of the cranberry market. C) Until the 1990s, Ocean Spray controlled almost the entire supply of cranberries. D) Ocean Spray was able to achieve significant economies of scale in the production of cranberries. Beginning in the 1990s, other firms finally achieved economies of scale as well, but Ocean Spray still controls about 80 percent of the cranberry market.
The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment. B. exogenous spending. C. recessionary gaps. D. expansionary gaps.
Foziah is a policy maker who is very concerned about inflation. Should she support a law that will index federal workers’ pay to the inflation rate? Explain why or why not.
What will be an ideal response?