Expectations

question 105

Multiple Choice

Expectations

• A) have no effect on monetary policy.
• B) have no effect on consumers' spending habits.
• C) play a role in fiscal policy but not in monetary policy.
• D) can dampen the effects of monetary policy.
• E) are easily studied in economics.

Calculate profit-maximizing output and price in multiplant monopoly settings.

Assess the impact of government intervention, through taxes, on prices and output in monopoly markets.

Understand the concept of the Lerner index and its application in measuring monopoly power.

Describe the conditions under which monopolies will produce and how this is affected by changes in marginal costs and demand elasticity.

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Definitions:

Revolving Credit

A credit agreement that allows a borrower to withdraw, repay, and redraw loans repeatedly up to a certain credit limit.

Magnuson-Moss Act

A federal law enacted to protect consumers from deceptive warranty practices, improving the enforceability of warranties on consumer products.

Injunctive Relief

A court order requiring a party to do or to refrain from doing specific acts.

Equal Credit Opportunity

A law that prohibits lenders from discriminating against applicants based on race, color, religion, national origin, sex, marital status, age, or because all or part of an applicant's income derives from any public assistance program.