Government spending is set by the federal authorities in such a way that aggregate supply just equals aggregate spending
a. True
b. False
Indicate whether the statement is true or false
False
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Joe's indifference map for lobster and soda is shown in the above figure along with his budget line. Will Joe choose point a? Explain your answer in terms both of MRS and the level of utility
What will be an ideal response?
Some take issue with the human capital argument that employers pay more for college graduates because firms recognize the value of human capital. What are two alternative explanations for why college grads receive higher pay?
In some industries where firms experience declining average total costs over the full range of output that consumers are willing to buy,
a. a smaller firm will always have lower per-unit costs. b. many firms will tend to emerge from the competitive process. c. a single large firm will develop, and it will have cost advantages that protect it from potential rivals. d. a single large firm will develop, and it will buy out any smaller rival firms to avoid the small firms' production at a lower per-unit cost.
Which of the following did classical economists believe caused depressions and high unemployment??
a. Sticky product prices
b. Tax increases
c. Business expectations
d. Sticky wages
e. Sticky interest rates