For a macroeconomist, the case for aggregation is based on two principles—(1) the composition of demand and supply may not matter for some purposes and (2)
A. during fluctuations markets normally move together.
B. individual markets allocate resources efficiently.
C. inflation, unemployment, and growth never go together.
D. individual markets distribute income efficiently.
Answer: A
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If the nominal exchange rate were to be expressed as the number of units of domestic currency per unit of foreign currency, and that rate decreases, then the domestic currency has:
A. become overvalued. B. become undervalued. C. appreciated. D. depreciated.
Efforts by a firm to obtain a monopoly
A) are called price discrimination. B) increase consumer surplus. C) are called rent seeking. D) are called price taking.
A goal of ________ is to give patients an incentive to pay more attention to the prices of medical services. This would tend to increase economic efficiency by decreasing the costs of medical services
A) the Patient Protection and Affordable Care Act (ACA) B) socialized medicine C) government-provided health care D) market-based reforms of the health care system
Refer to the data provided in Table 17.6 below to answer the following question(s). The table shows the relationship between income and utility for Isabel.Table 17.6 IncomeTotal Utility $00 $40,00020 $80,00050$120,00090$160,000150Refer to Table 17.6. Suppose Isabel has a 25% chance of becoming disabled in any given year. If she does become disabled, she will earn $0. If Isabel does not become disabled, she will earn her usual salary of $160,000. Isabel has the opportunity to purchase disability insurance for $40,000 which will pay her her full salary in the event she becomes disabled. Isabel's utility with the policy is
A. 37.5 and her expected utility without the policy is 75. B. 90 and her expected utility without the policy is 37.5. C. 112.5 and her expected utility without the policy is 90. D. 90 and her expected utility without the policy is 112.5.