Explain what is meant by automatic stabilizers and how they work to minimize fluctuations in economic activity
What will be an ideal response?
Automatic stabilizers refer to the effect that changes in economic activity have on the size of the actual deficit. The fact that T will automatically fall as Y falls, will dampen the effects of any negative shock on the economy.
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A monopolist finds the price-output combination that maximizes its profits by
A) equating total revenue and total cost. B) equating marginal revenue and marginal cost. C) finding the combination for which the difference between marginal revenue and marginal cost is the greatest. D) equating price and marginal cost.
Jamarcus works part-time as a pizza delivery person in a college town. The Bureau of Labor Statistics counts Jamarcus as
a. unemployed and in the labor force. b. unemployed and not in the labor force. c. employed and in the labor force. d. employed and not in the labor force.