If the multiplier is greater than 1 an initial (autonomous) decrease in aggregate demand will be
A. Equal to the eventual decline in spending.
B. Offset by an increase in planned investment.
C. Much larger than the eventual decline in spending.
D. Much smaller than the eventual decline in spending.
Answer: D
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The high tech boom of the late 1990s and early 2000s came to an end in part because
A) investment to address the Y2K problem was temporary. B) new computer applications were consumer oriented rather than directed at increasing productivity. C) the fiber optic cable boom has resulted in most optic cable capacity being unused. D) All of the above.
Which is NOT a characteristic of monopolistic competition?
A) small share of market to each firm B) lack of collusion among firms C) few firms in the industry D) independence of each firm's decisions
Assume that a firm's marginal revenue just barely exceeds marginal cost. Under these conditions the firm should:
a. expand output. b. contract output. c. maintain output. d. There is insufficient information to answer the question.
Joanne can choose to selectively disclose information to her superiors in an attempt to elicit decisions in her favor if:
a. the information is easily available to all. b. she is the only source of the information concerned. c. the information is easily verifiable. d. there are other sources of the same information in the firm.