An increase in both the equilibrium price and the equilibrium quantity of a good could not have been caused by a shift in supply alone
a. True
b. False
Indicate whether the statement is true or false
True
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An exception to weighting stocks by market cap is the Dow Jones Industrial Average, which uses the stock price relative to the sum of the prices of all the stocks in the index
a. True b. False Indicate whether the statement is true or false
Menu costs refer to:
A. the money, time, and opportunity used to change prices to keep pace with inflation. B. the time, money, and effort one has to spend managing cash in the face of inflation. C. being penalized via taxes for making more money in dollars, even though real purchasing power hasn't changed. D. labor costs associated with inflation.
Figure 16-2
Assume that a contractionary monetary policy has shifted the aggregate demand curve in Figure 16-2 from D0D0 to D1D1. Fiscal authorities who wish to restore real GDP to the full-employment level will
a.
run a budget surplus by increasing taxes or cutting government spending.
b.
run a balanced budget to prevent the interest rate from rising and cutting off investment.
c.
run a budget deficit by cutting taxes or increasing government spending.
d.
ignore the change in monetary policy since it has no effect on fiscal policy.
Answer the following statements true (T) or false (F)
1. In a purely competitive labor market, an individual firm must pay a rising price for labor if it wants to acquire more labor. 2. If a firm must pay a daily wage of $35 to hire 11 workers, and a daily wage of $40 to hire 12 workers, its marginal resource cost of hiring the twelfth worker is $40. 3. A monopsonist in the labor market tends to hire more workers than would be hired if the labor market were purely competitive. 4. A monopsonist faces an upsloping supply curve of labor, but it could face a horizontal demand curve for its product in the output market.