The total amount of producer surplus in a market is equal to the area below the supply curve
Indicate whether the statement is true or false
FALSE
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The demand curve is the same as another curve. Which curve is the same as the demand curve? Why are the curves the same?
What will be an ideal response?
In the short-run, an increase in government purchases will cause
A) a shift of the DD curve to the left and an increase in output. B) a shift of the DD curve to the right and a decrease in output. C) a shift of the DD curve to the left and a decrease in output. D) a shift of the DD curve to the right and an increase in output. E) a shift of the DD curve the left and an appreciation of the currency.
In the long run, firms in a perfectly competitive market produce:
A. where average variable costs are minimized. B. at a quantity with positive economic profits. C. where price equals marginal cost. D. where MC is at its lowest point.
In a recessionary gap, the implications of downward wage inflexibility are that there will be
A) further leftward shifts of AD that worsen unemployment. B) no further leftward shifts of AD, allowing the shifts in SRAS to close the recessionary gap. C) no further leftward shifts of SRAS, allowing the shifts in AD to close the recessionary gap. D) no rightward shifts of SRAS, allowing for the possibility of persistent high unemployment.