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.
d
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Market income is
A) profit earned in factor markets. B) interest earned in factor markets. C) wages, interest, rent, and profit earned in factor markets. D) wages, interest, rent, and profit earned in factor markets plus cash payments made to households by government.
During the first three years of a recovery from a recession, productivity
a. usually rises relatively rapidly. b. falls slowly. c. is quite puzzling since it is usually unpredictable with respect to the directional change. d. usually remains constant.
Which of the following would be classified as unemployed?
a. mothers who choose to stay at home with their preschool-age children b. retirees who are no longer working at a job c. students attending school full time d. a 20-year old looking for her first job
Refer to Figure 6.4. Suppose that the market is currently in equilibrium and the government decides to impose a maximum price equal to price A in the graph. How will the equilibrium quantity and price change as a result of the price ceiling?
A. It won't. The price ceiling is above the equilibrium, so the market stays at equilibrium. B. It will cause a shortage because at the price ceiling, the quantity demanded exceeds the quantity supplied. C. It will cause a surplus because at the price ceiling, the quantity demanded is below the quantity supplied. D. It won't. The price ceiling is below the equilibrium, so the market stays at equilibrium.