Which of the following is not an example of a practice that facilitates “tacit collusion”? A) Uniform prices charged by the firms in a particular industry. B) Advance notice of price changes by one or more of the firms in an industry. C) The use of most-favored-customer clauses. D) The formation of a cartel. […]
Date: September 10th, 2020
If marginal propensity to save equals 0.50, then the marginal propensity to consume is: A) 1.25. B) 0.50. C) 0.70. D) 1.00. ANSWER B
Date: September 10th, 2020
The “marginal rate of substitution” between two goods is measured by: A) the ratio of the market prices of the two goods. B) the number of units of a good consumed divided by the market price of the other good. C) the number of units of one good a consumer would give up to consume […]
Date: September 10th, 2020
“Learning by doing” has the effect of causing: A) a movement down the LRAC curve. B) a movement up the LRAC curve. C) the LRAC curve to shift up. D) the LRAC curve to shift down. ANSWER D
Date: September 10th, 2020
Household consumption primarily depends on: A) disposable income. B) the interest rate. C) marginal propensity to import. D) credit card debt. ANSWER A
Date: September 10th, 2020
Which of the following is most likely to create diseconomies of scale? A) concentration of production in a small number of very large plants. B) the use of automation devices. C) technological advance. D) division of labor. ANSWER A
Date: September 10th, 2020
Assume the income elasticity of a good has been calculated to be +0.83. Based on this information, we can infer that the good is: A) a normal good and a luxury. B) an inferior good and a necessity. C) a normal good and a necessity. D) an inferior good and a luxury. ANSWER C
Date: September 10th, 2020
The marginal propensity to consume is defined as: A) ΔC/ΔYd. B) ΔS/ΔYd. C) ΔYd/ΔC. D) ΔYd/ΔS. ANSWER A
Date: September 10th, 2020
All else constant, an improvement in technology at each scale of operation would cause: A) a movement up an industry’s LRAC curve. B) a movement down an industry’s LRAC curve. C) an upward shift of an industry’s LRAC curve. D) a downward shift of an industry’s LRAC curve. ANSWER D
Date: September 10th, 2020
All else constant, an increase in the amount of borrowing by the federal government would reduce the amount of money available for businesses to borrow to finance investment spending. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
