The level of an economic activity should be increased to the point where the ____ is zero
a. Marginal cost
b. Marginal benefit
c. Net marginal cost
d. Net marginal benefit
d
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Which of the following is true when a Nash equilibrium is reached in a duopoly with homogeneous products?
A) Both the firms earn positive economic profits. B) Each firm charges a price equal to its average fixed cost. C) Both the firms earn zero economic profits. D) Both firms incur huge losses.
In monopolistic competition in the long run, firms ________
A) make zero economic profit and require more capacity B) incur an economic loss and require more capacity C) make an economic profit and have excess capacity D) make zero economic profit and have excess capacity
Romer and Romer found evidence that money is not neutral because
A) in several episodes, such as 1979-1982, changes in monetary policy led to recessions. B) they found that inflation was highly correlated with the rate of growth of the money supply. C) if money were neutral, no one would care what the Fed does. D) they found no evidence that productivity changes or changes in government spending contributed to business cycles; only monetary changes preceded every recession.
A horizontal demand curve shows that demand for a good is _____
a. perfectly inelastic b. moderately inelastic c. unit-elastic d. moderately elastic e. perfectly elastic