A year-long drought that destroys most wheat crops for the season would shift the:
A. short-run aggregate supply curve only.
B. aggregate demand curve only.
C. aggregate demand curve, and the short-run aggregate supply curve would shift in response.
D. short-run aggregate supply curve and the long-run aggregate supply curve.
Answer: A
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For each bottle of wine that Italy produces, it gives up the opportunity to make 10 pounds of cheese. France can produce 1 bottle of wine for every 25 pounds of cheese it produces
Which of the following is true about the comparative advantage between the two countries? A) France has the comparative advantage in wine and cheese. B) Italy has the comparative advantage in wine. C) France has the comparative advantage in wine. D) Italy has the comparative advantage in cheese.
There are two forms of health care provided by the government: _________ is provided for the poor, and _________ is provided for the elderly.
A. HMO; Medicare B. PMI; HMO C. Medicaid; Medicare D. Medicare; Medicaid E. SSI; Medicare
When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline
All of the following statements regarding the marginal revenue product (MRP) curve and the demand for labor are true EXCEPT
A) an individual firm's demand for labor is its MRP curve. B) under conditions of perfect competition, MRP equals marginal physical product multiplied by the product's price. C) an increase in the market demand for a given product decreases the product's price. D) the demand for labor is a derived demand.