Mark spends his weekly income on gin and cocktail olives. The price of gin has risen from $7 to $9 per bottle, the price of cocktail olives has fallen from $6 to $5 per jar, and Mark's income has stayed fixed at $46 per week. If you measure gin on the vertical axis and cocktail olives on the horizontal axis, then the budget constraint
a. is steeper after the price changes.
b. is flatter after the price changes.
c. is the same after the price changes.
d. shifts in a parallel fashion to the old budget constraint after the price changes.
b
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If the Fed sells bonds through its open market operations, then there is
A) a decrease in interest rates because of the increase in the supply of bonds. B) an increase in the demand for bonds and a rise in the price of existing bonds. C) a decrease in interest rates because of the decrease in the demand for bonds. D) an increase in the supply of bonds and a fall in the price of existing bonds.
Suppose Barry is maximizing his utility from consuming used paperback novels and audio books. The price of a used novel = $4 and the price of an audio book = $8
If the marginal utility of the last novel was 32 units of utility (utils) what was the marginal utility of the last audio book purchased? A) 2 utils B) 12 utils C) 16 utils D) 64 utils
_____________ is defined as firm's ability to earn above-average profit
a. Resource heterogeneity b. Superior performance c. Competitive advantage d. Sustainable advantage
The choice between hawk and dove positions depends on
a. the extent of cyclical unemployment at the time of the decision b. relative importance of short-run and long-run monetary considerations c. cooperation between Congress and the monetary authorities d. the frequency of negative supply shocks e. the Fed's relative concern for price and employment stability