From an initial long-run macroeconomic equilibrium, if the Federal Reserve anticipated that next year aggregate demand would grow significantly faster than long-run aggregate supply, then the Federal Reserve would most likely
A) increase income tax rates.
B) decrease income tax rates.
C) increase interest rates.
D) decrease interest rates.
Answer: C
Economics
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Perfect price discrimination
a. eliminates deadweight loss. b. reduces profits to the monopolist. c. decreases the total quantity sold by the monopolist. d. requires arbitrage in order for the monopolist to maximize profits.
Economics
For a perfectly competitive industry, diminishing marginal returns
A. occur only in the long run. B. occur in both the short run and in the long run. C. occur only in the short run. D. Diminishing marginal returns do not occur in perfectly competitive industries.
Economics