In Figure 5.1, the demand curve that is perfectly elastic is on graph:
A. A.
B. B.
C. C.
D. D.
Answer: B
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If an economy has successful assigned policies under a fixed exchange regime, what will they have to do if they choose a new floating exchange regime?
A) Switch which agency is focused on internal vs. external balance. B) nothing C) Watch closely for signs of inflation which may trigger a policy misalignment problem. D) The answer is dependent upon their level of capital mobility which is unknown.
Macroeconomics is the study of
a. the behavior of large firms in the marketplace b. the economic behavior of individual decision makers c. the behavior of the economy as a whole d. how to use the fewest natural resources to produce goods and services e. government's role as a stabilizing influence on the economy
Congress passes a tax cut because economists predict a coming recession. This is an example of what?
a. Automatic stabilization. b. Active fiscal policy. c. Discretionary monetary policy. d. Non-discretionary monetary policy. e. none of the above.
Market failure establishes a basis for:
a) Government intervention. b) Private goods. c) Market power. d) Externalities.