If firms in a perfectly competitive industry are earning an economic profit, then in the ________, firms will ________ the industry
A) short run; enter
B) long run; enter
C) short run; exit
D) long run; exit
E) More information about the firms' costs and the price of the product is needed to determine if firms enter or exit the industry.
B
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If aggregate output is above its equilibrium level ________
A) there is an excess supply of goods B) actual output is below planned expenditure C) firms will tend to replenish their low inventories driving output up toward equilibrium D) all of the above E) none of the above
Imposing a tax on sales of a product
A) shifts the market demand curve for the product. B) shifts the market supply curve for the product. C) shifts both the market supply and demand curve for the product. D) has no effect on either the market demand or the market supply curve for the product.
The marginal propensity to consume is always
a. a negative number b. larger than 1.0 c. larger than 10 d. greater than zero and less than 0.5 e. greater than zero and less than 1.0
Ethan purchases a new house for $170,000 . Ethan's purchase of the house contributes $170,000 to which magnitude in the identity Y = C + I + G?
a. C b. I c. G d. None of the above are correct.