Refer to the information provided in Figure 28.7 below to answer the question(s) that follow.
Figure 28.7Refer to Figure 28.7. If the economy is at Point A, the cost of raw material increased dramatically, and the aggregate demand did not change, the economy could move to Point
A. A.
B. B.
C. E.
D. D.
Answer: D
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Firms in a small economy anticipated that inventories would grow over the past year by $750,000, and over that year, inventories grew by exactly $750,000. This implies that
A) aggregate expenditure was greater than GDP that year. B) there was an unplanned decrease in inventories that year. C) there was an unplanned increase in inventories that year. D) aggregate expenditure and GDP were equal that year.
Which of the following is true? i) A rational choice is made on the margin. ii) Microeconomics is the study of the national economy while macroeconomics is the study of the global economy. iii) Economists try to understand how the economic world works by testing normative statements.
A. Only ii B. i and ii C. Only iii D. i and iii E. Only i
A complicating factor in international trade is that
a. barter is the basis for trade between countries; money is not used. b. gold is used for payments; there are no international payments without gold. c. many other countries prefer to use the U.S. dollar as currency, causing monetary shortage in the United States. d. trade between countries requires different currencies rather than one currency.
The equilibrium price of a burger is $10, and the equilibrium quantity is 150 burgers. If the quantity of burgers sold increases to 200, the difference is a gain in net social welfare
a. True b. False Indicate whether the statement is true or false