In the Keynesian model, a $1 billion increase in autonomous consumption leads to ________ in equilibrium output.
A. no change
B. a greater than $1 billion increase
C. a $1 billion decrease
D. a $1 billion increase
Answer: B
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A profit maximizing single-price monopolist charges a price equal to
A) average total cost. B) marginal revenue. C) the highest price consumers are willing to pay for the profit maximizing quantity. D) the price necessary for the firm to earn a normal return on its investment.
Unemployment is referred to as a lagging indicator because
A) it tends to stay high for many months after output stops declining during a recession. B) reports on unemployment statistics tend to lag behind reports on inflation statistics. C) it takes time to collect information regarding unemployed individuals.. D) it indicates economic activities from the year before.