Keynes' speculative demand for money arises because
A) individuals are continually trying to maximize their wealth and income.
B) money is necessary to finance transactions.
C) there are costs to switching between money and interest-earning assets.
D) capital gains on bonds held can be made when interest rates are rising.
A
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Refer to the above figure. The firm is currently producing at Q2. The firm should
A) reduce production. B) leave production as it is. C) increase production. D) shut down.
Which of the following conditions would result in the short run marginal cost curve not correctly reflecting the supply behavior of a profit-maximizing firm?
a. The firm is a price taker. b. Price exceeds average total cost. c. The elasticity of demand facing the firm is -3. d. the firm can vary several inputs in the short run.