According to the Real Business Cycle model real wages should
A) remain constant.
B) fall during recessions.
C) rise during recessions.
D) stay the same during recessions but rise during expansions.
B
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In what way is monopolistic competition superior to perfect competition?
a. The cost of producing the industry's output is lower in monopolistic competition. b. Consumers benefit from having differentiated products instead of identical products. c. Long-run profits are higher in monopolistic competition than in pure competition. d. In monopolistic competition, firms can fully exploit any existing economies of scale.
Gross investment is equal to
A) depreciation minus net investment. B) net investment plus capital stock. C) depreciation plus net investment. D) net investment minus capital stock.
If the economy is to have built-in stability, when real GDP falls
A. tax revenues and government transfer payments should fall. B. tax revenues and government transfer payments should rise. C. tax revenues should fall and government transfer payments should rise. D. tax revenues should rise and government transfer payments should fall.
A promoter might charge less than the profit maximizing ticket price because
A. the talent may want to create a reputation for charging fair price so as to get more in the future. B. he believes his own "hype" about the demand for the event. C. he knows that the cost of constructing the facility is a "sunk cost" and must be ignored. D. all of the options are correct.