The aggregate supply curve will be vertical when:
a. output can be increased without an increase in the price level.
b. the economy is operating at full-employment capacity.
c. output and price level rise together.
d. the aggregate demand curve is shifting to the left.
e. aggregate demand is absent.
b
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The circular flow model with government included would show that government
A. produces goods and services and sells them in the product market to generate net taxes. B. obtains revenues in the product market and uses it to cover costs in the resource market. C. controls economic resources and sells them in the resource market. D. provides goods and services to businesses and households and pays for them with net taxes.
Explain why the rise in the price of a fixed basket of goods tends to overstate the rise in a consumer's true cost of living
When a monopolist is producing the profit-maximizing rate of output, price is greater than the marginal cost of producing the last unit of output
Indicate whether the statement is true or false
If disposable income increases from $912 to $927 billion and MPC = 0.6, then consumption will increase by:
A. $6 billion B. $9 billion C. $54 billion D. $56 billion