A rise in input prices of oil, which affects many or most firms across the economy, can cause the aggregate supply curve to______________.
a. shift
b. incline
c. decline
d. flatten
a. shift
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The concept of externalities means that subsidizing education can be justified on the grounds that as a student becomes better educated, the student will
A) earn a higher income. B) enhance the lives of people around the student. C) make contributions to the student's alma mater. D) none of the above
When a person bases her future expectations for the economy on all available current data and her own judgment about future policy effects, this is known as
A) the policy irrelevance proposition. B) rational expectations. C) irrational expectations. D) the new classical theory.
Externalities can be either detrimental or beneficial to others
a. True b. False Indicate whether the statement is true or false
Larry has a comparative advantage over his classmates in writing term papers if he:
A. can write term papers faster than his classmates. B. always earns an A on his term papers. C. has a lower opportunity cost of writing term papers than his classmates. D. has an absolute advantage in writing term papers.