An increase in demand will cause the demand curve to
a. move to the right.
b. move to the left.
c. become more vertical.
d. become more horizontal.
a. move to the right.
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Refer to the above figure. If the aggregate demand curve shifts beyond AD5, then the economy will experience
A) stagflation. B) demand-pull inflation. C) structural inflation. D) cost-push inflation.
The lawsuit the Justice Department brought against Apple regarding the pricing of e-books for its iPad is an example of attempts by the government
A) to prevent horizontal mergers which would significantly reduce competition. B) to prevent vertical mergers which would significantly reduce competition. C) to regulate a natural monopoly by establishing government-regulated prices. D) to keep firms from artificially restricting competition to raise prices.
Suppose labor productivity differences are the only determinants of comparative advantage, and Brazil and Chile both produce only coffee and sugar. In Chile, either 5 units of coffee or 2 units of sugar can be produced in one day. In Brazil, a day of labor produces either 2 units of coffee or 1 unit of sugar. What is the opportunity cost of producing coffee in Chile?
a. Half a pound of sugar b. Two-fifth of a pound of sugar c. 2 pounds of sugar d. One-third of a pound of sugar e. 4 pounds of sugar
Which of the following is correct?
a. Any event that changes the supply or demand for labor must change the value of the marginal product. b. A profit-maximizing firm hires workers so long as the wage rate exceeds the value of the marginal product of labor. c. An increase in the supply of labor increases both employment and wages. d. A decrease in the demand for labor decreases wages but increases employment.