In a Lorenz curve, perfect income equality is represented by
A) a vertical line.
B) a horizontal line.
C) a rectangular hyperbola.
D) a 45-degree line originating from the origin.
D
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How do RBC economists face the business cycle fact that inflation is procyclical?
A) They argue that even though inflation doesn't fit their theory, everything else does, and inflation is not important. B) They note that inflation would not be procyclical if monetary policy were conducted properly. C) They argue that inflation is procyclical only because monetary policy shocks are the main cause of business cycles. D) They use alternative statistical methods that suggest that inflation is countercyclical.
A manager believes there is a 10 percent chance their firm will have to pay $1,000,000 and a 90 percent chance they will be found innocent and pay nothing except the legal fees of $200,000. If the manager is offered a settlement deal of $300,000 (the manager's firm would pay the plaintiff $300,000), and the manager flips a coin to decide if they should settle or not, which of the following
statements is true? A) The manager is risk averse. B) The manager is risk neutral. C) The manager is a risk lover. D) The manager is risk intolerant.
Diseconomies of scale are associated with
a. Inefficiencies b. Cost reduction c. Improvement in technology d. Division of labor
If the LRAC curve for Company A has a clear minimum point without a curved bottom, then Company B will have ________________ if it produces a different number of units.
a. lower costs b. higher costs c. lower profits d. higher profits