Figure 10-17
With the passage of time, which of the following will tend to direct this economy in toward its long-run sustainable rate of output?
a.
lower interest rates that will stimulate AD and lower resource prices that will increase SRAS
b.
higher interest rates that will reduce aggregate demand and higher resource prices that will reduce SRAS
c.
lower interest rates and higher resource prices, both of which will stimulate aggregate demand
d.
higher interest rates that will reduce SRAS and lower resource prices that will stimulate aggregate demand
b
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Which of the following is an example of resources that are substitutes?
a. steel and glass used in auto manufacturing b. glue and wood used in furniture manufacturing c. buttons and cotton used in shirt manufacturing d. leather and rubber used in basketball manufacturing e. eggs and flour used in baking
A buyer's consumer surplus on a unit of a good is its value to that buyer minus what the buyer actually pays for it
a. True b. False
For many years, dairy farmers would milk their cows and bring the milk to market. After buyers and sellers negotiated all sales, the farmers dumped large quantities of milk into rivers. What does it tell us about that milk market? A free market would not have created an ______, so that in this case there must have been a _________
a. opportunity to dump milk; special permit b. excess supply; price floor c. excess demand; price floor d. excess supply; price ceiling e. excess demand; price ceiling
The deadweight loss caused by the monopoly market structure is equal to the loss of total surplus resulting from the good being sold by a monopolist rather than in a competitive market
a. True b. False Indicate whether the statement is true or false