In the short run,
a. utilization of any input can be varied
b. production takes less than one year
c. all resources are limited in supply
d. utilization of some inputs is assumed constant
e. equilibrium cannot occur
D
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The presence of new goods that are of higher quality than the old goods leads the BLS to
A) update the market basket every time a new good is available. B) do nothing because at least some people still buy the old goods. C) try to separate price differences from improvements in quality. D) actually understate the cost of living when calculating the CPI. E) immediately update the reference base period used in calculating the CPI.
Prices of smartphones (assume that this is a normal good) have fallen in recent years. Over this same period, the price of the components used to produce smartphones has also fallen and consumer incomes have risen
Which of the following best explains the falling prices of smartphones? A) The supply curve for smartphones has shifted to the right while the demand curve for smartphones has shifted to the left. B) The supply curve for smartphones has shifted to the right more than the demand curve has shifted to the right. C) The demand curve and the supply curve for smartphones have both shifted to the left. D) The demand curve for smartphones has shifted to the right more than the supply curve has shifted to the right.
What is the law of supply and how do we illustrate it?
What will be an ideal response?
Which of the following scenarios illustrates the theory of rational expectations? a. Kyle decides to buy a plot of land near the new industrial hub of his city
b. Sheila decides to take up a job in a shoe store rather than studying further. c. Dean decides to look for new jobs when the economy is in recession. d. Kevin determines that the average miles per gallon on his last three car trips is 37.