Farmer Brady sells wheat in a market where sellers are price takers. Which of the following is true in regard to Farmer Brady's production and pricing decisions?
a. Farmer Brady will be able to increase the total revenue from the sale of his wheat if he increases the price of the wheat.
b. Since the market dictates the price of his product, Farmer Brady will have no incentive to minimize per-unit production costs.
c. Since the market dictates the price of his product, Farmer Brady has no production decisions to make.
d. It would be senseless for Farmer Brady to try to increase sales by lowering the price of his product. His entire output can be sold at the market price.
d
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Which of the following is not an example of price discrimination?
a. Senior citizen discount at the movies b. Grocery coupons c. Children haircuts d. Charging a higher price for ice-cream during the summer and a lower price in the winter
The isoquant mapping for perfect complements in production is
A. a straight line. B. concave. C. L-shaped. D. a ray passing through the origin.
At the end of 2008, the federal funds rate in the United States was close to zero. Which of the following is a major concern associated with such a low rate?
A) That traditional monetary policy will have no impact on the economy. B) Such a low rate spurs excessive consumption and investment spending which may lead to inflation. C) Such a low rate spurs excessive consumption and investment spending which may lead to deflation. D) Economic agents might be unwilling to borrow in anticipation of even lower interest rates.
The total amount that the U.S. government spends to support a covered type of health care service under the Medicare system equals
A) the per-unit subsidy provided to producers of that service times the quantity of the service demanded by consumers at a below-equilibrium out-of-pocket price of the service. B) the per-unit subsidy provided to producers of that service times the equilibrium quantity of the service demanded at the market clearing price that would arise in the absence of Medicare. C) the below-equilibrium, out-of-pocket price that consumers pay for the service times the quantity of the service provided by producers at that out-of-pocket price. D) the below-equilibrium, out-of-pocket price that consumers pay for the service times the quantity of the service demanded by consumers at that out-of-pocket price.