Those who favor a passive approach to policy often argue that changes in prices and wages will shift the:
a. short-run aggregate supply curve before active policy shifts the aggregate demand curve
b. short-run aggregate supply curve only after active policy shifts the aggregate demand curve.
c. short-run aggregate supply curve more than active policy shifts the aggregate demand curve.
d. short-run aggregate supply curve less than active policy shifts the aggregate demand curve.
e. short-run aggregate supply curve in a direction opposite the shift in the aggregate demand curve
a
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Economic growth is a sustained expansion of production possibilities measured as the increase in ________ over a given period
A) capital per person B) population C) real GDP D) real GDP per person E) the standard of living
Which of the following appropriately applies the law of comparative advantage?
a. Countries with small amounts of labor relative to capital should specialize in producing labor-intensive commodities. b. Since Mexican labor is cheaper than American labor, trade between the countries results in exploitation of American workers. c. Since workers in countries such as the United States utilize larger amounts of capital than workers in less developed nations, trade between capital-rich and capital-poor nations results in the exploitation of labor in the less developed countries. d. Countries that are low cost producers of agricultural products should trade those products for goods they can produce only at a high opportunity cost.
Real GDP is the most effective measure for determining the:
A. Income level per household. B. Change in the price level. C. Standard of living across countries. D. Growth rate of the economy over time.
Suppose your firm is operating in a perfectly competitive market, and that the minimum average variable cost of producing your good is $13. If the price of the good is $15, your firm should:
A. supply the amount of the good where the marginal cost of production is equal to $15. B. not produce anything since the price is above the minimum of average variable cost. C. not consider price when determining the amount to sell. D. not do any of these.