Inflation occurs over time as a result of
A) long-run aggregate supply increasing faster than aggregate demand.
B) long-run aggregate supply increasing faster than short-run aggregate supply.
C) decreases in aggregate demand.
D) aggregate demand increasing faster than long-run aggregate supply.
D
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Rent controls are
A) when rents are set above the market clearing level to aid landlords. B) used to provide incentives to contractors to build new apartments. C) used to generate revenue for the local government. D) when rents are set below the market clearing level.
Assume that product X has a positive cross elasticity with respect to shoes. If the price of shoes rises
A) the demand for product X will decrease. B) the quantity demanded for product X will increase. C) the demand for shoes will fall. D) the demand for product X will increase.
The income level below which families are said to be poor is known as the
a. income maintenance threshold. b. poverty line. c. bottom quintile of the income distribution. d. minimum wage.
Economic models suggest that movie stars have salaries that
a. can only be explained by looking at specific movie stars and their individual salaries. b. are about equal to their marginal revenue products. c. understate their full contribution to the movie studio's revenue-as the celebrities are the main reason that people go to see movies. d. greatly exceed their marginal contribution to the movie studio's revenue.