The uncertainty costs of inflation cause ________ because ________
A) a decrease in investment and slower growth; people focus on the long run and not the short run
B) an increase in investment and faster growth; people focus on the short run and not the long run
C) a decrease in investment and slower growth; people increase their demand for money
D) a decrease in investment and slower growth; people focus on the short run and not the long run
E) an increase in investment and faster growth; people decrease their demand for money
D
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A farmer sells raw milk for 50 cents to a dairy, who sells cheese made from it for $1.50 to a grocery wholesaler, who sells it for $1.90 to a supermarket, who sells it to the final consumer for $2.19. These transactions increase the GDP by
A) $0.50 + $1.00 + $0.40 + $0.29 = $2.19. B) $0.50 + $1.00 + $1.90 + $2.19 = $5.59. C) $0.50 + $1.00 = $1.50. D) $2.19 - $1.50 = $0.69. E) $2.19 - $0.50 = $1.69.
What are the functions for MC and AC if TC = 40 + 10q + 5q2?
A) MC = 10q; AC = 10 + 5q B) MC = 10 + 10q; AC = 40/q + 10 + 10q C) MC = 10 + 10q; AC = 40/q + 10q2 D) MC = 20 + 10q; AC = 40/q + 10q