Which of the following statements about equilibrium is true?
a. The positive and the normative attributes of equilibrium are similar.
b. The equilibrium price fails to redistribute goods in accordance to individual valuations.
c. Equilibrium refers to a state of complete happiness or fairness.
d. In equilibrium there are neither surpluses nor shortages.
D
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To achieve long-run equilibrium in an economy with a recessionary gap, without the use of stabilization policy, the inflation rate must:
A. not change. B. increase. C. decrease. D. either increase or decrease depending on the relative shifts of AD and AS.
Your neighbor likes to blast 1970's rock music and the louder the better. The loud music imposes a cost on you because it disrupts your study of economics. Let D stand for the volume of his music in decibels, B for his benefits and C for your costs, where B and C are measured in dollars. For any given volume, D, your neighbor's benefit is B = 0.63D - 0.002D2 and your cost is C = 0.06D + 0.001D2. What is the marginal cost to you at the socially efficient noise level?
A. $0.75 B. $0.29 C. $0.24 D. $0.25
In the above figure, at output levels between 5 units and 13 units
A) the firm's accounting profits are negative. B) total revenue equals total costs. C) the firm's economic profits are positive. D) the firm is breaking even.
In the above figure, along the section of the demand curve between point a and point b, demand is
A) elastic. B) inelastic. C) unit elastic. D) unit inelastic.