A long run supply curve:
a. will rise if diminishing returns are encountered.
b. will rise if diseconomies of scale are encountered.
c. assumes that all resources are variable
d. is characterized by both (b) and (c).
d
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A sharp increase in the divorce rate increases the number of lawyers hired to determine divorce settlements. This will
A) increase GDP and decrease well-being in the economy. B) decrease GDP and decrease well-being in the economy. C) increase GDP and increase well-being in the economy. D) decrease GDP and increase well-being in the economy.
Rational self-interest means
A) always increasing your wealth. B) pursuing what makes you better off. C) pursuing activities that maximize income. D) always pursuing activities that are consistent with your faith.
A decrease in the dollar price of foreign currency would cause
a. the nation's imports to increase and exports to decline. b. the nation's exports to increase and imports to decline. c. both imports and exports to decline. d. both imports and exports to rise.
According to the Keynesian transmission mechanism (and assuming there is no liquidity trap and investment is not interest insensitive), if the money supply increases, the interest rate __________, investment spending __________ and the AD curve shifts to the __________
A) falls; falls; left B) rises; rises; right C) falls; rises; left D) falls; rises; right E) rises; falls; right