A rise in the price level because of an increase in the money wage rate...
What will be an ideal response?
might trigger a cost-push inflation
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It is often argued that gas stations operate inefficiently because they have "excess capacity" in the form of more pumping stations than they would otherwise need if they were operating under conditions of perfect competition
However, can you think of any reason why a gas station franchise owner would wish to install more pumps than he knows will rarely if ever be fully utilized at any one time? Can you explain the economic logic of this "apparent" wastefulness?
For each pair of goods, explain which is more elastic: toothpicks vs. cars; electricity vs. yachts; IBM computers vs. Apple computers.
What will be an ideal response?
Over time, countries grow in a fashion so that their production possibility frontiers always retain the same shape
Indicate whether the statement is true or false
Refer to the diagrams below. In which of them would we see a shortage at the initial price after the indicated curve has shifted?
In the diagrams below, the subscript "1" refers to the initial position of the curve, while the subscript "2" refers to the final position after the curve shifts.
A. A and D
B. B and D
C. B and C
D. A and C