The Federal Reserve fears that the United States economy is growing too slowly and is stuck in a recession. To move the economy back to its potential GDP, the most likely policy action for the Fed is to ________ the federal funds and thus ________
A) raise; increase aggregate demand
B) raise; decrease aggregate demand
C) lower; increase aggregate supply
D) lower; decrease aggregate supply
E) lower; increase aggregate demand
E
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If the government reduces spending ________
A) the IS curve will shift to the right B) output will increase if interest rates remain fixed C) consumption will increase D) all of the above E) none of the above
Figure 11-5
In Figure 11-5, Crown Theater, a monopolist movie theater, has chosen the profit-maximizing output. At this output level, the value of MR is what value?
A. $7.50 B. $6.00 C. $4.50 D. $3.00
Net National Product equals:
a) Gross National Product adjusted for inflation b) Gross Domestic Product adjusted for inflation c) Gross Domestic Product plus net property income from abroad d) Gross National Product minus depreciation
Recall the Application about the costs involved in opening a restaurant to answer the following question(s).Recall the Application. Because the restaurant industry is considered monopolistic competition, it is expected that in the long run, restaurant franchise owners earn:
A. zero economic profits. B. positive economic profits. C. zero accounting profits. D. negative accounting profits.