In 1986, OPEC countries increased their production of oil. This caused
A. the price level to rise.
B. aggregate supply to shift right.
C. unemployment to rise.
D. All of these responses are correct.
Answer: B
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Investments made "today" in machines, equipment and buildings do not have an immediate effect on total capital stock
Indicate whether the statement is true or false
Which of the following is true about a monopoly?
A) Its demand curve is generally less elastic than in more competitive markets. B) It will always earn economic profit. C) It will always produce the same as a perfectly competitive firm. D) It will always be subject to government regulation. E) None of the above is true.
Suppose that a worker in Country A can make either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can make either 18 bananas or 6 tomatoes each year. Country B has 400 workers. The workers in Country A should specialize in ________ because they possess the ________ in the production of that good.
A. bananas; comparative advantage B. tomatoes; absolute advantage C. tomatoes; comparative advantage D. bananas; absolute advantage
If there are external costs in production and firms do not have to account for these costs, then firms will produce
A. an output level that is either above or below the efficient level. B. at the efficient level. C. an output level that is above the efficient level. D. an output level that is below the efficient level.