(Consider This) From an economist's perspective:
A. small government is better than big government.
B. big government is better than small government.
C. regardless of size, government is incapable of achieving allocative or productive efficiency.
D. the size of government doesn't matter, as long as spending occurs up to where MB = MC.
Answer: D
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The short run Phillips curve
A) shows that any inflation rate can co-exist with the natural unemployment rate. B) shows the tradeoff between the inflation rate and the unemployment rate, and it shifts when the expected inflation rate changes. C) shows the relationship between the inflation rate and the expected inflation rate, and it shifts when the natural unemployment rate changes. D) shows the relationship between the inflation rate and the nominal interest rate, and it shifts when the natural unemployment rate changes. E) shows the tradeoff between the inflation rate and the unemployment rate and it shifts when the inflation rate changes.
In the short run, a profit-maximizing firm's decision to produce should be guided by whether
A) its total revenue exceeds its fixed cost. B) its total revenue covers its variable cost. C) it makes a profit. D) its marginal profit is maximized.