Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, as the economy moves from Point B to Point D, the opportunity cost of motorcycles, measured in terms of hybrid cars,
A. increases
B. remains constant.
C. initially increases, then decreases.
D. decreases.
Answer: A
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If an economy is producing a level of output which is lower than the equilibrium level, planned expenditures ________ total output and ________ goods and services are being produced than are being demanded
A) exceed; fewer B) are less than; more C) are less than; fewer D) exceed; more
The above figure shows the market for game day t-shirts. If the price of t-shirts is $10, then
A) there is a surplus and the price of t-shirts will fall. B) there is a shortage and the price of t-shirts will fall. C) there is a shortage and the price of t-shirts will rise. D) there is a surplus and the price of t-shirts will rise. E) the market is in equilibrium.
If a German firm produces cars in the United States, that production should count towards
A) U.S. GDP. B) German GDP. C) U.S. GNP. D) both U.S. GNP and German GDP.
"In a long-run equilibrium, price is equal to average total cost." This statement applies to
a. competitive markets, but not to monopolistically competitive markets or monopolies. b. competitive and monopolistically competitive markets, but not to monopolies. c. competitive markets, monopolistically competitive markets, and monopolies. d. None of the above is correct.