"Cost disease" refers to the tendency for low productivity in the service sector to lead to higher costs in those industries
Indicate whether the statement is true or false
TRUE
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Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; potential C. higher; higher D. lower; higher
Refining gasoline for our cars requires a very specialized resource, crude oil. As a result, the
A) demand for gasoline is price elastic. B) demand for gasoline is price inelastic. C) supply of gasoline is price elastic. D) supply of gasoline is price inelastic.
Why does each of the following facilitate the creation and stability of a cartel?
a. High barriers to entry b. An identical product c. Similar costs
An increase in demand:
a. results in a leftward shift of the demand curve. b. could be caused by a decrease in the price of the good. c. could be caused by an increase in the price of a substitute good. d. is shown as movement down along a demand curve.