An upward shift in the Fed's reaction function is equivalent to:
A. an increase in the Fed's long-term target for inflation.
B. a decline in the Fed's long-term target for inflation.
C. a downward shift of short-run aggregate supply
D. an upward shift of short-run aggregate supply
Answer: B
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Agraria specializes in the production of cotton. However, cotton manufacturers in Agraria are expecting the demand for its exports to fall sharply due to growing competition from a neighboring country
Assuming all else equal, which of the following is likely to happen in this case? A) The equilibrium unemployment in Agraria will fall. B) The equilibrium real wage in Agraria will rise. C) Investment expenditure in Agraria will rise. D) Consumption expenditure in Agraria will fall.
Everything else held constant, a credit-drive bubble is generally considered to have the potential to cause ________ damage to an economy compared to an irrational exuberance bubble
A) less B) about the same amount of C) more D) either more, less, or the same amount of
In long-run equilibrium, a monopolistically competitive firm's demand curve will be tangent to its average cost curve
a. True b. False Indicate whether the statement is true or false
The MLC curve increases for a monopsonist because
a. hiring more workers raises total labor costs b. output price rises as a firm's market power increases c. hiring more workers does not affect wages d. the later workers hired are less productive e. as more workers are hired, all workers receive higher wages