Questions from General Economics

Q: If inventories unexpectedly rise, then production ________ sales and firms will

If inventories unexpectedly rise, then production ________ sales and firms will respond by ________ output. a. Trails; expanding. b. Trails; reducing. c. Exceeds; expanding. d. Exceeds; reducing.

Q: If the multiplier is 5 and investment increases by $3 billion

If the multiplier is 5 and investment increases by $3 billion, equilibrium real GDP will increase by: a. $2 billion. b. $3 billion. c. $8 billion. d. $15 billion. e. None of the above.

Q: A depression abroad will tend to ________ our exports, which in

A depression abroad will tend to ________ our exports, which in turn will _________ net exports, which in turn will ________ equilibrium real GDP. a. Reduce; reduce; reduce. b. Increase; increase; in...

Q: True or False: The aggregate expenditures model assumes flexible prices.

True or False: The aggregate expenditures model assumes flexible prices.

Q: The economy’s current level of equilibrium GDP is $780 billion.

The economy’s current level of equilibrium GDP is $780 billion. The full employment level of GDP is $800 billion. The multiplier is 4. Given those facts, we know that the economy faces ________ expend...

Q: If an economy has an inflationary expenditure gap, the government could

If an economy has an inflationary expenditure gap, the government could attempt to bring the economy back toward the full-employment level of GDP by ________ taxes or ________ government expenditures....

Q: If total spending is just sufficient to purchase an economy’s output,

If total spending is just sufficient to purchase an economy’s output, then the economy is: a. In equilibrium. b. In recession. c. In debt. d. In expansion.

Q: Which of the following could explain why a firm is a monopoly

Which of the following could explain why a firm is a monopoly? Select one or more answers from the choices shown. a. Patents b. Economies of scale. c. Inelastic demand. d. Government licenses. e. Dow...

Q: The MR curve of perfectly competitive firm is horizontal. The MR

The MR curve of perfectly competitive firm is horizontal. The MR curve of monopoly firm is: a. Horizontal, too. b. Upsloping. c. Downsloping. d. It depends.

Q: Use the demand schedule below to calculate total revenue and marginal revenue

Use the demand schedule below to calculate total revenue and marginal revenue at each quantity. Plot the demand, total-revenue, and marginal-revenue curves, and explain the relationships between them....