Which of the following statements best describes the U.S. economy since 1960?
a. Potential output has risen steadily, but actual output has fluctuated above and below full-employment output.
b. Actual output has risen steadily, but potential output has fluctuated above and below actual output.
c. Potential output and actual output have both not risen steadily.
d. Potential output and actual output have both fluctuated above and below what the classical model predicts.
e. Potential output has remained constant but actual output has risen.
A
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The income effect from a fall in the price of a gallon of gasoline is shown in the above figure by the movement from
A) point A to point C. B) point A to point B. C) point B to point C. D) point A to point B and then to point C.
Which of the following is a gain from trade?
A. A higher price level for all trading countries. B. A shorter workweek for all trading countries. C. A level of self-sufficiency for all trading countries. D. A higher standard of living for all trading countries.
If Jack underprices Jill this month and Jill employs a tit-for-tat strategy, how can both parties return to the cartel outcome?
A. Jack must raise the price and allow Jill to underprice him for one month. B. Jack must retaliate by employing the grim-trigger strategy. C. Jack must cry and beg and plead for Jill to come back to the cartel outcome. D. Jack must report Jill to the Department of Justice.
Why does price discrimination work in the sale of seats to children and adults at baseball games, but not to the sale of food at concession stands to children and adults at baseball games?
What will be an ideal response?