In less developed economies more economic activity is "do-it-yourself"
Indicate whether the statement is true or false
true
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting downward C. Aggregate demand shifting rightward D. Aggregate demand shifting leftward
Refer to Figure 16-6. In the dynamic model of AD-AS in the figure above, if the economy is at point A in year 1 and is expected to go to point B in year 2, and no fiscal or monetary policy is pursued, then at point B
A) the unemployment rate is very low. B) there is pressure on wages and prices to fall. C) income and profits are falling. D) firms are operating at below capacity. E) the economy is below full employment.
If foreign exchange rates are determined by the interaction of supply and demand forces for the various currencies, then the exchange rate is
a. fixed b. government-determined c. set by the value of gold d. said to float e. not in equilibrium
According to the contestable market model, if there are no barriers to entry or exit, the price an oligopolist sets will provide no economic profits in the long run.
Answer the following statement true (T) or false (F)