Consider an industry that is in long-run equilibrium. An increase in demand leads to no change in the price of the good. We know that this is
A) a decreasing-cost industry.
B) a constant cost industry.
C) an increasing-cost industry.
D) not a competitive industry.
Answer: B
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Cost minimization suggests that two inputs should be employed to the point where
A) the marginal cost of each input is identical. B) the marginal revenue product of each input is identical. C) the marginal physical product per dollar spent on each input is identical. D) the extra contribution to physical output of the inputs is identical.
Since the 1970s, the Phillips curve has:
a. remained stable. b. moved in a clockwise direction. c. been unstable. d. been used as a reliable model to guide public policy.
In contrast to a tariff, a quota does not
A) reduce consumers' surplus. B) increase producers' surplus. C) generate revenues for government. D) raise price. E) c and d
When the housing bubble popped, the effect of the negative demand side shock and the negative supply side shock were the same on:
A. output, causing it to definitely decrease. B. prices, causing them to definitely rise. C. output, causing it to definitely increase. D. prices, causing them to definitely fall.