Dimitry’s country has a population growth rate of 1 percent and an output growth rate of 2 percent. What would happen to the per capita output if the population were to begin increasing at a rate of 3 percent, while output growth stayed at 2 percent?
a. It would be unaffected.
b. It would rise.
c. It would fall
d. It would fall, then rise.
c. It would fall
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Which of the following is not a determinant of demand?
a. production costs b. consumer expectations c. prices of related goods d. tastes and preferences of consumers
If a competitive firm cannot earn a profit at any level of output during a given short-run period, then which of the following is FALSE?
A) It will shut down in the short run and wait until the price increases sufficiently. B) It will exit the industry in the long run. C) It will operate at a loss in the short run. D) It will minimize its loss by decreasing output so that price exceeds marginal cost.
A deadweight loss:
A. can be large in a perfectly competitive market. B. is a reduction in aggregate surplus below its maximum possible value. C. is independent the amount produced and consumed. D. is equal to the difference between total willingness to pay and the total avoidable cost of production.
Excess demand occurs:
A. when price is below the equilibrium price. B. when price is above the equilibrium price. C. whenever the market is not in equilibrium. D. whenever the market is in equilibrium.