When total revenue minus total cost is equal to zero, the firm is:
A. earning above-average economic profit.
B. earning a normal profit.
C. losing too much money to stay in business.
D. earning abnormally low profits.
Answer: B
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Starting from long-run equilibrium, a large increase in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; potential B. recessionary; higher; potential C. recessionary; lower; lower D. expansionary; higher; higher
If robotics and factory automation become more widespread in an industry and all else is held constant
A. the demand for labor should decrease in that industry and the wage rate should increase. B. the demand for labor should increase in that industry and the wage rate should decrease. C. both the demand for labor in that industry and the wage rate should decrease. D. both the demand for labor in that industry and the wage rate should increase.
The concepts of comparative advantage, specialization, and trade form a compelling argument in favor of:
A. free trade. B. protectionism. C. self-sufficiency. D. only exporting goods and not importing goods.
Which of the following is an example of an intermediate good?
a. The flowers that Mr. Grover buys at a local nursery b. The flowers that Timmy picks from a neighbor's garden and brings to Mrs. Grover c. The flour that Grandma buys to bake a birthday cake d. The flour that Joe buys so that he can eat pizza three nights a week e. The flour that Amy orders each month for the bakery she manages