When the nation of Mooseland first permitted trade with other nations, domestic producers of sugar experienced a decrease in producer surplus of $5 million and total surplus in Mooseland's sugar market increased by $2 million. We can conclude that
a. Mooseland became an exporter of sugar.
b. the overall economic well-being of participants in the sugar market in Mooseland fell because of trade.
c. consumer surplus in Mooseland increased by $7 million.
d. the opening of trade caused the domestic demand curve for sugar in Mooseland to shift to the right.
c
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Indicate whether the statement is true or false
According to New Keynesian theory, fluctuations in the target interest rate are not a good explanation of the business cycle because the model predicts that
A) consumption is constant. B) labor is countercyclical. C) average labor productivity is countercyclical. D) output is countercyclical.
Exhibit 4-3 Supply and demand curves
In Exhibit 4-3, an increase in demand would cause a movement from which equilibrium point to another, other things being equal?
A. E1 to E2. B. E1 to E3. C. E4 to E1. D. E1 to E4.
A firm's long-run position under perfect competition is often said to be efficient because
A. P = MR = MC = ATC. B. P = MR = AVC = AFC. C. P = AR > MC = AVC. D. P = AR > MR = MC.