Refer to Table 9-11. Prior to trade, what was the opportunity cost to produce 1 clock in Denmark?
A) 1/6 of a hat B) 1/2 of a hat C) 2 hats D) 6 hats
B
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Which of the following statements is true about monopolistically competitive firms?
A) Like perfectly competitive firms, monopolistically competitive firms are not able to raise prices without losing all of their customers because they face competition from firms selling similar products. B) Unlike perfectly competitive firms, monopolistically competitive face perfectly inelastic demand curves. C) Like perfectly competitive firms, monopolistically competitive firms maximize their profits by setting price equal to marginal cost. D) Unlike perfectly competitive firms, monopolistically competitive firms are able to raise their prices without losing all of their customers.
According to the quantity theory of money demand
A) an increase in interest rates will cause the demand for money to fall. B) a decrease in interest rates will cause the demand for money to increase. C) interest rates have no effect on the demand for money. D) an increase in money will cause the demand for money to fall.