John Maynard Keynes believed the ideas of economists to be
a. generally incorrect.
b. powerful.
c. academic and without practical application.
d. rantings of madmen.
b
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If a curve falls and then rises, it
A) has a maximum. B) has a minimum. C) has a linear relationshi
Suppose a monopoly firm has an annual demand function of Qd = 20,000 - 250P, annual variable costs of VC = 16Q + 0.002Q2 and marginal cost of MC = 16 + 0.004Q, where Q is the annual quantity of output. In addition, the firm has an avoidable fixed cost of $25,000 per year. If this firm maximizes its profit, what is the value of aggregate surplus?
A. $247,250 B. $272,250 C. $242,000 D. $217,000
Which of the following is true when profit-maximizing firms in a competitive market are allowed to freely emit negative externalities on society?
a. Consumers are paying a market equilibrium price that reflects the full social marginal cost of production. b. Consumers are paying a market equilibrium price that reflects only the external marginal cost of production. c. Consumers are paying a market equilibrium price that is less than the socially efficient price, and consuming more than the socially efficient quantity. This means society is implicitly subsidizing producers by allowing them to pollute. d. None of the above is correct.
Unexpectedly high inflation reduces unemployment in the short run, but as inflation expectations adjust the unemployment rate returns to its natural rate
a. True b. False Indicate whether the statement is true or false