When a monopoly increases its output and sales,
a. both the output effect and the price effect work to increase total revenue.
b. the output effect works to increase total revenue, and the price effect works to decrease total revenue.
c. the output effect works to decrease total revenue, and the price effect works to increase total revenue.
d. both the output effect and the price effect work to decrease total revenue.
b
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If expectations are rational, the difference between the actual inflation rate and the forecast for inflation is: a. positive when inflation is increasing
b. negative when inflation is increasing. c. random. d. greater, the more accurately people anticipate the effects of government policy.
Consider a world of two countries producing only wheat and cloth. In one hour, residents of Country A can produce 1 unit of wheat and 0.5 unit of cloth, whereas residents of Country B can produce 0.3 unit of wheat and 0.4 unit of cloth. Country A should export
A. wheat and cloth; country B should not export anything. B. cloth and country B should export wheat. C. nothing and country B should export both wheat and cloth. D. wheat and country B should export cloth.