When prices are predetermined, the level of output that equals aggregate expenditure is called ________ output.
A. induced
B. short-run equilibrium
C. potential
D. the natural rate of
Answer: B
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By the 21st century few people purchased printed encyclopedias. Which of the following competitive forces best explains this?
A) competition from substitutes B) the bargaining power of suppliers C) the bargaining power of buyers D) the threat from potential entrants
One problem that might occur as a result of economic regulation is
A) the firm may be earning more than a normal rate of return on investment. B) the quality of service might be lowered. C) that social regulation may follow. D) the demand for the good may be greater than the supply.
Figure 32-2
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Assume that a contractionary monetary policy has shifted the aggregate demand curve in Figure 32-2 from D0D0 to D1D1. Fiscal authorities who wish to restore real GDP to the full-employment level will
A. run a budget surplus by increasing taxes or cutting government spending. B. run a balanced budget to prevent the interest rate from rising and cutting off investment. C. run a budget deficit by cutting taxes or increasing government spending. D. ignore the change in monetary policy since it has no effect on fiscal policy.
Economies of scale are an important determinant of comparative advantage-based trade
Indicate whether the statement is true or false