Stimulating demand will improve the unemployment picture but
A. worsen inflation.
B. decrease inflation.
C. have no impact on inflation.
D. None of the above is correct.
Answer: A
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Firms in perfectly competitive markets who wish to maximize profits should:
A. keep producing more as long as marginal cost is less than marginal revenue. B. produce less as long as marginal cost is greater than marginal revenue. C. produce where marginal cost and marginal revenue are equal. D. All of these are true.
In the last few decades, income inequality in the United States has ___________ mostly because of the ____________
A. increased; poor getting poorer. B. increased; gains by the rich. C. decreased; gains by the poor. D. decreased; stagnation by the economy in general.
Why are bonds less risky than stocks?
a. The dividend given on shares is usually less than the coupon-rate on bonds. b. Bonds can be issued only by the government whereas shares are issued by private firms. c. Bondholders have a claim on the assets of the firm whereas the shareholders do not. d. Shareholders are entitled to a share of the company's earnings. e. The higher the profit of the firm, the greater the share of the bondholders.
Jason considers a crystal bowl, a silver dish, and a pewter figurine, each priced $45 at the local gift shop. He chooses the silver dish because, according to economic theory
a. his marginal utility per dollar is greatest. b. his total utility is minimized. c. his marginal utility is equal to his total utility. d. silver costs more per ounce than pewter.