Why is the long-run aggregate supply curve a vertical line?
A) At that level of real GDP, the production costs are at their lowest level.
B) At that level of real GDP, production costs have fully adjusted to price changes.
C) At that level of real GDP, the unemployment rate is 0 percent.
D) At that level of real GDP, the inflation rate is 0 percent.
B
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Cost-plus pricing would be consistent with selecting the profit-maximizing price when
A) the demand for the firm's product is unit elastic. B) consumers value the product beyond its marginal cost. C) a firm has no difficulty estimating its demand curve. D) it results in a price that causes quantity sold to be where marginal revenue equals marginal cost.
In the Keynesian world a falling real money supply causes GDP to __________ by __________ the real interest rate which causes a(n) __________ in investment
A) increase; increasing; increase B) increase; decreasing; increase C) decrease; increasing; increase D) decrease; increasing; decrease
The aggregate demand curve slopes downward in part due to the:
A. negative relationship between the price level and net exports. B. positive relationship between the price level and exports. C. negative relationship between the price level and imports. D. All of these are true.
How can the government cut the cost of negotiation among car owners regarding LoJack installation?
a. The government can impose a quota on the import of LoJacks. b. The government can invite public opinion on LoJacks. c. The government can limit the number of companies producing LoJacks. d. The government can randomly select cars to install LoJacks.