Suppose that when the price of hamburgers increases, the Ruiz family increases their purchases of hot dogs. To the Ruiz family
A) hamburgers and hot dogs are complements.
B) hamburgers and hot dogs are inferior goods.
C) hamburgers and hot dogs are normal goods.
D) hamburgers and hot dogs are substitutes.
Answer: D
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Holding other things constant, increases in the price level in the US will
a. Cause the dollar to appreciate b. Cause the dollar to depreciate c. Does not affect the dollar value d. None of the above
When price is greater than marginal cost for a firm in a competitive market,
a. marginal cost must be falling. b. the firm must be minimizing its losses. c. there are opportunities to increase profit by increasing production. d. the firm should decrease output to maximize profit.
A monopoly
a. can set the price it charges for its output and earn unlimited profits. b. takes the market price as given and earns small but positive profits. c. can set the price it charges for its output but faces a downward-sloping demand curve so it cannot earn unlimited profits. d. can set the price it charges for its output but faces a horizontal demand curve so it can earn unlimited profits.
Modern macroeconomics developed as an attempt to explain:
A. short-run business cycles. B. balance of trade problems. C. long-run growth. D. persistent inflation.