Firms in a cartel or engaged in tacit collusion should set ________ equal to ________ to maximize profit.
A) the market marginal revenue; their firm's marginal cost
B) their firm's marginal revenue; their firm's marginal cost
C) their firm's marginal revenue; the market marginal cost
D) the market marginal revenue; the market marginal cost
A) the market marginal revenue; their firm's marginal cost
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Historically, the largest U.S. federal budget deficits as a percentage of GDP since the beginning of the 20th century occurred during
A) the Great Depression. B) World War I and World War II. C) 1970-1997. D) 2007-2009.
Since 2010, the federal funds rate has been well below the rate suggested by the Taylor rule. A likely explanation for the discrepancy is that ________
A) the Fed's dual mandate prevents a close reliance on the Taylor rule B) policy makers decided that instability of the coefficients prevents the Taylor rule from having any role in policy decisions C) in the past, adherence to the Taylor rule led to policy mistakes D) all of the above E) none of the above
Unemployment that results from business recessions that occur when aggregate demand is insufficient to create full employment is
A) frictional unemployment. B) structural unemployment. C) cyclical unemployment. D) seasonal unemployment.
A monopsonist wants to purchase more labor. Which of the following statements is TRUE?
A) The wage rate that the monopsonist has to pay future workers is lower than it pays current workers since there is no other place to work. B) The wage rate that the monopsonist has to pay future workers will be the same rate it pays current workers. C) The wage rate that the monopsonist has to pay future workers is higher than what it will continue to pay current workers. D) The monopsonist will have to raise the wage rate for current and additional employees.