Other things remaining the same, the greater the expected profit
What will be an ideal response?
the greater the amount of investment.
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Use the following production possibilities frontier to answer the next question.
Which point or output-combination in the above graph could the nation produce only if it experienced economic growth?
A. combination E B. combination C C. combination F D. combination G
An increase in the price level leads to
A) an upward movement along the aggregate supply curve. B) a downward movement along the aggregate supply curve. C) a leftward shift of the aggregate supply curve. D) a rightward shift of the aggregate supply curve. E) neither a movement along the aggregate supply curve nor a shift of the aggregate supply curve.
Refer to the above figure. S1 is the supply curve that includes only private costs. S2 is the supply curve that includes social costs. From this figure we know that
A) an external benefit exists. B) private costs are less than social costs. C) private costs equal social costs. D) private costs are greater than social costs.
Prohibiting price increases in situations of true scarcity
A. prevents the market mechanism from reallocating resources more efficiently. B. discourages production. C. may lead to extreme shortages of vitally needed products. D. All of the responses are correct.