An increase in interest rates will immediately shift
A. aggregate supply to the right.
B. aggregate demand to the left.
C. aggregate demand to the right.
D. aggregate supply to the left.
Answer: B
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Refer to Figure 16.3 below. When the MC z line crosses the D z line, profits for the firm are
A. 0.
B. greater than 1.
C. less than 0.
D. ?.
Ray just got a raise, and decided to splurge on a fancy dinner to celebrate. The change to Ray's demand for fancy dinners could be measured by the:
A. price elasticity of supply. B. price elasticity of demand. C. cross-price elasticity. D. income elasticity of demand.
In a two-input model you can tell that a non-optimal short-run production decision is being made if
a. all decisions in the short run are nonoptimal b. the rate of technical substitution is equal to the ratio of the input prices c. the rate of technical substitution is not equal to the ratio of the input prices
Trade between countries is based on
A) absolute advantage only. B) monopoly power. C) comparative advantage. D) none of these choices.