The liquidity trap refers to the portion of the money demand curve that is
A. Upward-sloping.
B. Downward-sloping.
C. Vertical.
D. Horizontal.
Answer: D
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A firm's long-run average cost curve shows the ________ average cost at which it is possible to produce each output when the firm has had ________ time to change both its labor force and its plant
A) highest; sufficient B) lowest; sufficient C) lowest; insufficient D) highest; insufficient E) average; sufficient
Which of the following is a negative externality connected to automobile transportation?
A) Driving faster than the 65 mph speed limit is not allowed, even though individuals are able to do it, and many want to. B) In an accident, a person who chooses not to wear a seatbelt becomes an object moving around the inside of the car, possibly hitting other, belted-in, passengers with lethal force. C) Gasoline is taxed on a per-gallon basis. D) Gasoline is imported, and thus increases the trade deficit. E) While stuck in traffic, you have a chance to listen to your favorite CD, which you haven't had the time to do in other places.
Ben quit his job as an economics professor to become a golf professional. He gave up his salary ($40,000 . and invested his retirement fund of $50,000 (which was earning 10 percent interest) in this venture. After all expenses, his net winnings (profit) were $45,000 . Ben's economic profits were
a. $45,000. b. $5,000. c. $2,000. d. zero.
Figure 18-2
Figure 18-2 shows the widget market before and after an excise tax is imposed. After the tax is imposed, the amount that a firm keeps for itself from the sale of each widget is ____.
A. $95 B. $100 C. $120 D. $125