Suppose the Fed decreased the growth rate of the money supply. Which of the following would be lower in the long run?
a. both the natural rate of unemployment and the inflation rate
b. the natural rate of unemployment, but not the inflation rate
c. the inflation rate, but not the natural rate of unemployment
d. neither the natural unemployment rate nor the inflation rate
c
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Maximizing the benefits of a transaction made under a contract often requires specific investments that lose value if the parties fail to fulfill their commitments
Indicate whether the statement is true or false
Economic profits in an industry suggest the industry:
A. can earn more profits by increasing product price. B. should be larger to better satisfy consumers' desire for the product. C. has excess production capacity. D. is the size that consumers want it to be.
Suppose Bev's Bags makes two kinds of handbags-large and small. Bev rents an industrial space where she keeps the fabric, the industrial sewing machine, her measuring board and cutting shears, extra needles, thread and buttons, and labels. Bev can produce three bags an hour, regardless of the size of bag. Which of the following would be considered a fixed cost of this company?
A. The sewing thread B. The fabric C. The rent Bev pays D. None of these would be considered a fixed cost.
A ______ market is one in which a number of buyers and sellers are offering similar products, and no single buyer or seller can influence the market price.
a. bullish b. command c. competitive d. regulated