When plotted with the aggregate price level on the vertical axis and output on the horizontal axis, which of the following curves is vertical?
A) SRAS
B) AD
C) LRAS
D) None of the above
C
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A fall in the federal funds rate leads to
A) a decrease in the quantity of money. B) a rise in the real interest rate. C) a decrease in investment. D) a rise in the price level. E) a decrease in real GDP.
Refer to Figure 2-13. Which two arrows in the diagram depict the following transaction: Lizzie Haxem hires "The Paint Pros," a professional painting company, to paint her home
A) J and G B) K and M C) K and G D) J and M
If a firm is a price taker in both the labor market and the output market, it will
A) earn zero economic profit in the short run. B) hire labor until the marginal product of labor equals zero. C) hire labor until the marginal revenue product equals the output price. D) hire labor until the marginal revenue product equals the wage rate.
Input demand is called derived demand because
a. demand for an input is derived from demand for the product or service it produces. b. demand for an input is derived from its availability in the input market. c. demand for the output produced is also derived from consumer demand. d. input demand actually determines how much output is produced.