Cheap talk
A) is never credible.
B) is illegal.
C) generally affects the game's payoffs.
D) can be credible when both firms have an incentive to be truthful.
D
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The figure above shows the loanable funds market. If the real interest rate is 10 percent, then
A) there is a shortage in the loanable funds market. B) the government must intervene in order to prevent a credit crisis. C) the interest rate must increase. D) savers will exit the market because of the high opportunity cost of saving. E) there is a surplus in the loanable funds market.
A monopolistically competitive firm is similar to
A) a monopoly in the short run because it can make an economic profit in the short run and is similar to a perfectly competitive firm in the long run because it cannot make a positive economic profit. B) a perfectly competitive firm in the short run because it cannot make an economic profit in the short run and is similar to a monopoly in the long run because it can make an economic profit. C) a monopoly because it can make an economic profit in both the short run and long run. D) a perfectly competitive firm because its economic profit is equal to zero in both the short run and long run.
The following are national income account data for a hypothetical economy in billions of dollars: government purchases ($1,050), personal consumption expenditures ($4,800), imports ($370), exports ($240), and gross private domestic investment ($1,130). Personal consumption expenditures are approximately what percentage of this economy?
A. 60 percent B. 75 percent C. 70 percent D. 65 percent
Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward