The ECB, like the U.S. Federal Reserve, is ______, and unlike the U.S. Federal Reserve, is not ______.
A) independent; a lender of last resort
B) subject to scrutiny by the legislature; able to lend to large corporations
C) dependent on congressional approval for its policies; committed to price stability
D) able to lend to member governments; able to lend directly to banks
Answer: A) independent; a lender of last resort
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What types of goods have downward-sloping Engel curves?
a. Normal goods only. b. Inferior goods only. c. Giffen goods only. d. All types of goods.
What is one reason activists might lobby the government for regulation limiting the production of a product to less than would normally be in a perfectly competitive market?
A) They value consumer surplus more than producer surplus. B) They value producer surplus more than consumer surplus. C) They seek to avoid future regulation. D) They seek to minimize total surplus.
An upscale fusion bistro in a small town charges higher prices for the same menu items at dinner time than at lunch time. Does the bistro necessarily practice price discrimination?
Explain your answer
A monopolist sells a homogeneous good in several distinct submarkets, and the elasticities of demand differ in these submarkets. If the monopolist selects the rate of output to sell in each submarket by equating marginal revenue and marginal cost, then
A. it is not price discriminating, but merely price differentiating. B. customers in markets with more elastic demand will pay higher prices than customers in markets with less elastic demand. C. customers in markets with more elastic demand will pay lower prices than customers in markets with less elastic demand. D. all customers in all markets end up paying the same price.