When a firm has economic profits equal to zero
A) the firm is earning a normal rate of return on investment.
B) the firm is not earning a normal rate of return on investment.
C) the firm should shut down.
D) the firm's accounting profits are also zero.
Answer: A
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Under a fixed exchange rate system, if the inflation rate of the United States exceeds the inflation rate of other nations, the
A) dollar will depreciate. B) dollar will appreciate. C) United States will develop a trade surplus. D) United States will develop a trade deficit.
Which of these statements about fiscal policy is correct?
A. Fiscal restraint is implemented when the economy is experiencing high unemployment. B. Fiscal stimulus is implemented when the economy is experiencing high inflation. C. The goal of fiscal policy is to match aggregate demand with full employment potential. D. All of these statements are correc