Expansionary fiscal policy is so named because it:
A. necessarily expands the size of government.
B. involves an expansion of the nation's money supply.
C. is aimed at achieving greater price stability.
D. is designed to expand real GDP.
Answer: D
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In a perfectly competitive market, if a firm finds it is producing an amount of output such that its marginal cost exceeds its price, it will
A) immediately shut down for the short run. B) be maximizing profits. C) increase its output to increase its profit. D) decrease its output to increase its profit.
A cartel
a. consists of two firms that collude to eliminate product differentiation so that they can sell their goods as identical goods b. is a group of firms that collude to limit competition within their market c. refers to the breakup of a firm into two or more firms where each produces a good that does not compete against the others d. is a government-supported merger of two or more firms to improve the nation's advantage in international trade e. is an illegal merger of two firms that produce unrelated goods
The interest rates on outstanding credit card balances are generally high because
A) the default rate on credit card loans is high and there are no assets backing these loans. B) the banks "price gouge" consumers in this market. C) there is little competition in this lending market. D) the administrative costs associated with these loans are low.
A shift in supply is defined as a change in
A. Equilibrium quantity. B. Price. C. Quantity supplied because of a change in price. D. The supply curve because of a change in a determinant of supply.