Explain the difference between a "change in quantity supplied" and a "change in supply."
What will be an ideal response?
A 'change in quantity supplied' refers to a movement along the supply curve because of a change in the price of the good itself. A 'change in supply' refers to a shift of the supply curve. Factors that cause the supply curve to shift include a change in technology, factor costs, other goods, taxes and subsidies, expectations, and the number of sellers.
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According to proponents of the interest-rate-based monetary policy transmission mechanism, any increase in the money supply
A) causes velocity to increase, and so in the short run nominal Gross Domestic Product (GDP) must increase. B) will increase Gross Domestic Product (GDP) only if interest rates fall and investment is sensitive to decreasing interest rates. C) is effective in increasing Gross Domestic Product (GDP) only if it causes an outward shift of the aggregate supply curve. D) will move the economy from the "liquidity trap" during times of recession if interest rates fall enough to stimulate private investment.
Why do consumers prefer higher indifference curves (farther to the right) to lower indifference curves?
What will be an ideal response?
Leontief used an input-output table in order to test the
A) classical theory. B) the Heckscher-Ohlin theory. C) the Linder hypothesis. D) All of the above.
In order to successfully increase net revenue by charging buyers different prices, a seller must
What will be an ideal response?