If expectations are formed rationally, then individuals
A) will have a forecast that is 100% accurate all of the time.
B) change their forecast when faced with new information.
C) use only the information from past data on a single variable to form their forecast.
D) have forecast errors that are persistently low.
B
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A time series is
A) the length of a business cycle. B) a macroeconomic aggregate that does not lead or lag the business cycle. C) data that is subject to revision. D) a sequence of dated measurements.
Assume a firm is a monopoly and enjoys $10 million in profits per year. The firm lobbies to have a moratorium passed by Congress on new firms in its market for the next 25 years
If there is no discount rate, how much would the firm be willing to pay to deter entry? A) $250 million B) $25 million C) $100 million D) $250 billion
____ is the act of buying a commodity in one market at a lower price and selling it in another market at a higher price
a. Buying short. b. Discounting. c. Tariffing. d. Arbitrage.
Suppose that initially, supply is given by the equation Qs = 4P ? 16. If, as a result of lower production costs, the quantity supplied increases by 4 at every price, the new supply equation would be:
A. Qs = 4P ? 12. B. Qs = 8P ? 16. C. Qs = 4P ? 20. D. Qs = P ? 16.