Suppose that the initial supply of loanable funds curve is SLF1. In the figure above, an increase in the real interest rate leads to
i. a shift in the supply of loanable funds curve from SLF1 to SLF2.
ii. a shift in the supply of loanable funds curve from SLF1 to SLF3.
iii. a movement along the supply of loanable funds curve SLF1.
iv. no change whatever.
A) i and iii B) iv only C) ii only D) i only E) iii only
E
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Which of the following statements regarding an average-cost pricing rule for a natural monopoly is WRONG?
A) It sets price equal to average total cost. B) It is efficient. C) The firm makes zero economic profit. D) More output is produced than if the firm maximized profit.
In setting the price of its product, a monopolistic competitor sets the price equal to its marginal cost plus an amount called the
A) markup. B) profit. C) rent. D) menu cost.
In a market with a downward-sloping demand curve and an upward-sloping supply curve, a law requiring sellers to pay the government a tax of $1.00 per pack on cigarettes has the effect of:
A. shifting the supply curve to the right and increasing the price buyers pay by $1.00. B. shifting the demand curve to the right and increasing the price buyers pay by $1.00. C. shifting the supply curve to the left and increasing the price buyers pay by less than $1.00. D. shifting the demand curve to the left and increasing the price buyers pay by less than $1.00.
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, a decrease in unemployment may be represented by the movement from
A. B to A. B. C to D. C. B to D. D. A to C.