In the Mainstream View, One Major Source of Instability in the Macro

question 48

Multiple Choice

In the mainstream view, one major source of instability in the macro economy is the volatility of:

• A) Product prices
• B) Investment spending
• C) Consumer spending
• D) Labor wages

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Definitions:

Oligopolistic Industries

Sectors characterized by a small number of large firms that have significant control over market prices and competition.

Differentiated Products

Goods or services that are distinguished from similar products by characteristics like quality, design, and features.

Standardized Products

Goods that are made to specific standards to ensure consistency and uniformity, facilitating mass production and interchangeability across different brands or producers.

Homogeneous Oligopolists

A market structure where a few firms offer products or services that are similar in nature and hence are close substitutes for each other.