Assuming there are no externalities, if a firm is producing at an output level where the benefits to consumers are less than the cost to the suppliers to produce it, then price
A. is greater than marginal cost.
B. is less than marginal revenue.
C. equals marginal cost.
D. is less than marginal cost.
Answer: D
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If the U.S. dollar is pegged to gold, then
A) the Federal Reserve must adjust the supply of U.S. dollars when the price of gold changes. B) the government must buy and sell gold reserves when the price of the dollar changes. C) the U.S. dollar will not change in value since the price of gold is constant. D) the U.S. dollar would become more valuable than the Euro.
The financial crisis of 2007-2009 worsened after the failure of which firm?
A) General Motors B) Lehman Brothers C) Bear Stearns D) American International Group (AIG)
If money is neutral, then changes in the quantity of money
a. do not affect real output. b. affect both nominal and real output c. do not affect nominal output. d. affect neither nominal nor real output.
Briefly explain the effect of pursuing expansionary policy during a time of full employment.
What will be an ideal response?