Referring to the graph above, a movement from point H to point I might represent ________
A) the increase in the inflation rate that occurs when the real interest rate rises
B) the automatic response of monetary policy to an increase in the inflation rate
C) an autonomous tightening of monetary policy
D) any of the above
E) none of the above
B
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Assume someone organizes all farms in the nation into a monopoly. Which of the following occurs? i. Consumer surplus decreases. ii. Economic profit increases. iii. A deadweight loss is created
A) i only B) ii only C) iii only D) i and ii E) i, ii, and iii
When firms in an industry are selling similar products, and they agree to share the market,
A) each firm earns a profit even though marginal cost is greater than marginal revenue. B) each firm secures a net revenue about as large as it would have received if it were the only seller. C) they try to keep each firm's price above its marginal cost. D) they tend to produce higher prices and larger output. E) the agreement will enforce itself because none of the firms will have an interest in triggering a competitive struggle.