Suppose the economy's current AD and SRAS curves intersect to the right of Natural Real GDP. Keynesians might advise a policy of tax __________ to shift __________
A) increases; SRAS to the left
B) increases; AD to the left
C) cuts; SRAS to the right
D) cuts; AD to the right
B
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Refer to the table below. ________ has the comparative advantage in making pizza, and ________ has the comparative advantage in delivering pizza. Pizzas MadePer HourPizzasDeliveredPer HourCorey126Pat1015
A. Pat; Pat B. Corey; Pat C. Pat; Corey D. Corey; Corey
The above figure is for a firm in monopolistic competition. The diagram represents the short run rather than the long run because the
A) MR curve cuts the ATC curve from below. B) MR curve and the D curve do not coincide. C) firm is incurring an economic loss. D) firm is making an economic profit.
Assuming the economy represented in the graph shown is currently at point B, if the government does nothing, then eventually:
A. SRAS will shift to the right, and the economy will have Y3 output with lower prices.
B. SRAS will shift left, and the economy will experience stagflation.
C. LRAS will shift left, until lower equilibrium output is reached with lower prices.
D. the entire economy will collapse.
What are the characteristics of monopolistic competition?
What will be an ideal response?