If a natural disaster were to cause a negative long-run supply shock to the economy, once the economy adjusts, the new equilibrium will be at a:
A. higher price level and lower level of output.
B. lower price level and lower level of output.
C. higher price level and higher level of output.
D. lower price level and higher level of output.
Answer: A
You might also like to view...
A store remains open from 8 a.m. to 4 p.m. each weekday. The store owner is deciding whether to stay open an extra hour each evening. The owner's marginal benefit
A) is the benefit the owner receives from staying open from 8 a.m. to 5 pm. B) depends on the revenues the owner makes during the day. C) must be greater than or equal to the owner's marginal cost if the owner decides to stay open. D) is the benefit the owner receives from staying open from 8 a.m. to 6 pm.
Brenda says, "You would have to pay me $50 to attend that pro wrestling event." For Brenda, the marginal utility of the event is:
A) zero. B) positive, but declines rapidly. C) negative. D) positive, but less than the ticket price.
In which of the following decades did the Phillips curve break down for the U.S.?
A) 1940s B) 1950s C) 1960s D) none of the above
Technological progress increases the efficiency of mass producing HDTV-capable television sets. At the same time, more cable and television networks begin broadcasting in HDTV format, increasing the appeal of HDTV-capable television sets. On the basis of this information, what can be said about conditions in the HDTV market? a. The equilibrium quantity and price of HDTV-capable sets will
increase. b. The equilibrium quantity of HDTV-capable sets will increase and price will decrease. c. The equilibrium quantity of HDTV-capable sets will increase and what happens to price is indeterminate. d. The equilibrium quantity of HDTV-capable sets will decrease and price will increase.