In a competitive industry where different firms have different cost structures, the industry supply curve is:
A) upward sloping.
B) downward sloping.
C) vertical.
D) horizontal.
A
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In order to continue its operations, in the long-run a firm must
a. Charge a price that is equal to its AVC b. Charge a price that is equal to its AFC c. Charge a price that is equal to its AVC + AFC d. Need more information to determine the price
Your aunt gives you a PepsiCo bond with face value of $5,000 . It will mature in two years. Currently, the interest rate is 10 percent (0.10) per year. How will the value of the bond change if the interest rate falls to 5 percent tomorrow morning?
a. It will rise by $413.22. b. It will rise by $402.90. c. It will rise by $432.90. d. It will fall by $432.90. e. It will fall by $402.92.
Friedman and Phelps argued that
a. if peoples' inflation expectations were fixed, then an increase in the money supply growth rate could not change output in the short or long run. b. if peoples' inflation expectations were fixed, then a decrease in the money supply growth rate could raise output and unemployment in the short run. c. any change in unemployment created by making aggregate demand increase more rapidly is temporary because people eventually revise their inflation expectations. d. None of the above is correct.
Summarize the impacts of prices ceilings and price floors on the free market
What will be an ideal response?