In the long run, a year-long drought that destroys most of the summer's wheat crops causes permanently:
A. higher prices.
B. lower prices.
C. lower output.
D. None of these is true.
Answer: D
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A firm's revenue minus its factor payments equals
a. zero. b. the profits or losses earned by the firm. c. the quasi-rents earned by the factors of production. d. the firm's total revenue.
Contractual savings institutions include
A) mutual savings banks. B) money market mutual funds. C) commercial banks. D) life insurance companies.
Deflation is generally considered by economists to be a positive economic situation because it creates strong job growth
Indicate whether the statement is true or false.
A major factor contributing to the recession of 1981-1982 was
A. an increase in interest rates. B. an increase in exports. C. the multiplier effect. D. an increase in unemployment.