There is an inverse relationship between the quantity of money demanded and the interest rate. True or False
True
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When the purchasing power of money is stable and predictable, this
A) increases transactions costs. B) facilitates gains from specialization, investment, and trade. C) encourages the use of bartering. D) makes it risky for individuals and businesses to save and borrow.
The expected effect of the Bush tax cuts would be a(n)
a. lower real interest rate. b. exchange rate depreciation. c. increased current account deficit. d. All of the above are correct.
Figure 6-2
illustrates the four possibilities of the structure of production and consumption for a good or service. In which case is the incentive of producers to be efficient and the incentive for consumers to economize the weakest?
a. A
b. B
c. C
d. D
Answer the following statement true (T) or false (F)
1) In maximizing profit, a firm will always produce that output where total revenues are at a maximum. 2) In the short run, a competitive firm will always choose to shut down if product price is less than the lowest attainable average total cost. 3) A competitive firm will produce in the short run so long as its price exceeds its average fixed cost. 4) The short-run supply curve slopes upward because producers must be compensated for rising marginal costs.