A medium of exchange must be
a. approved by the government
b. socially acceptable in exchange for goods and services
c. easy to reproduce
d. used to eliminate specialization and the division of labor
e. used when a system of barter exists
B
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Refer to Figure 3-4. At a price of $25, how many units will be sold?
A) 400 B) 500 C) 600 D) 800
John Maynard Keynes believed that a recession was caused entirely by
A. inadequate aggregate supply. B. inadequate aggregate demand. C. too much inflation. D. too much government intervention.
If fast food is an inferior good then:
A. the demand for fast food will fall as income falls. B. the demand for fast food will fall as income rises. C. the demand for fast food will fall as the price of fast food rises. D. the quantity of fast food demanded will rise as the price of fast food rises.
Max Shreck, an accountant, quit his $80,000-a-year job and bought an existing tattoo parlor from its previous owner, Sylvia Sidney. The lease has five years remaining and requires a monthly payment of $4,000. Max's explicit cost amounts to $3,000 per
month more than his revenue. Should Max continue operating his business? A) Max's explicit cost exceeds his total revenue. He should shut down his tattoo parlor. B) Max should continue to run the tattoo parlor until his lease runs out. C) If Max's marginal revenue is greater than or equal to his marginal cost, then he should stay in business. D) This cannot be determined without information on his revenue.