A decrease in taxes would shift the: A) aggregate demand curve rightward. B) aggregate demand curve leftward. C) aggregate supply curve rightward. D) aggregate supply curve leftward. ANSWER A
Date: September 10th, 2020
Which of the following is true of the relationship between the marginal cost function and the average total cost and average variable cost functions? A) If MC is greater than ATC and AVC, then ATC and AVC will increase. B) The ATC and AVC curves intersect the MC curve at minimum MC. C) The MC […]
Date: September 10th, 2020
A French citizen lives in Detroit, but works in Windsor, Canada; his income is counted in U.S. GDP. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
Suppose a monopolist is producing a level of output such that MR > MC. What should the firm do to maximize its profits? A) The firm should do nothing — it wants to maximize the difference between MR and MC in order to maximize its profits. B) The firm should hire less labor. C) The […]
Date: September 10th, 2020
Which of the following conditions holds for a monopolist, but not for a perfect competitor, at the profit-maximizing level of output? A) Price = average revenue. B) Marginal revenue = marginal cost. C) Price > marginal cost. D) Profit = (AR-ATC) x Q. ANSWER C
Date: September 10th, 2020
How did McDonalds address the drive-through innovation in China? What will be an ideal response? ANSWER Customers had to be taught how to use the drive-through window. Many outlets had customers place their orders through a person rather than a speaker to demystify the procedure.
Date: September 10th, 2020
Briefly state several reasons for the decline in sales for McDonald’s in 2001-2002. What will be an ideal response? ANSWER Consumer tastes and preferences changed as more individuals became concerned about the high-fat content of most fast foods. There were a number of lawsuits launched against the fast food industry with respect to health […]
Date: September 10th, 2020
Who are the voting members of the Federal Open Market Committee and why is this committee important? Where does the power lie within this committee? What will be an ideal response? ANSWER The FOMC determines the monetary policy of the United States through its decisions about open market operations. It also effectively determines the […]
Date: September 10th, 2020
Instrument independence is the ability of ________ to set monetary policy ________. A) the central bank; goals B) Congress; goals C) Congress; instruments D) the central bank; instruments ANSWER D
Date: September 10th, 2020
An inverted yield curve predicts that short-term interest rates A) are expected to rise in the future. B) will rise and then fall in the future. C) will remain unchanged in the future. D) will fall in the future. ANSWER D
Date: September 10th, 2020
