Use the figure below to answer the following question.
If actual production and consumption occur at Q2
A. missing surplus of a + b + c + d occurs.
B. economic surplus is maximized.
C. missing surplus of e + f occurs.
D. missing surplus of a + c occurs.
Answer: B
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Lucas argues that when policies change, expectations will change thereby
A) changing the relationships in econometric models. B) causing the government to abandon its discretionary stance. C) forcing the Fed to keep its deliberations secret. D) making it easier to predict the effects of policy changes.
A cartel is a group of firms that acts as if it were a monopoly and produces where MR = MC for the industry
Indicate whether the statement is true or false
Providing basic health care and education for poor countries is cost-prohibitive.
Answer the following statement true (T) or false (F)
Three workers run a house painting business and always work the same number of hours together. The paint they use requires applying two coats. Each worker paints 200 square feet per hour using a roller or 80 square feet per hour using a brush. If a technological advance provides a paint that only requires one coat, their average labor productivity per hour as a team:
A. increases. B. remains the same. C. may either increase or decrease. D. decreases.