If AD and AS increase at exactly the same rate, the result will be
A. demand-side inflation.
B. supply-side inflation.
C. falling prices.
D. stable prices.
Answer: D
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Accounting profits are calculated based upon: a. explicit cash receipts and implicit costs
b. actual cash receipts and actual expenditures of cash. c. implicit cash receipts and actual expenditures of cash. d. opportunity costs plus explicit costs.
The profits of the leader in a Stackelberg duopoly:
A. equal those of the follower. B. are greater than those of the follower. C. are greater than those of a Sweezy oligopolist. D. are less than those of the follower.
The purpose of an effluent fee imposed on a firm is
A) to increase output of its product by increasing the resources allocated to production. B) to increase output of its product by reducing the resources allocated to production. C) to reduce output by increasing production costs thereby reducing resources used. D) none of the above
Because resources are scarce, the opportunity cost of investment in capital is
A. infinite. B. forgone present consumption. C. zero. D. forgone future consumption.