If the price of oil increased by 15 percent when oil producers believed that other prices were rising 10 percent over the same period, what would happen to the quantity of real output supplied by the oil industry?
Oil producers would be subject to the misperception effect. This would typically only occur in the short run. The oil producers would be fooled by the price changes in the short run and believe they had the opportunity to make greater profits by expanding their output, since they believe the value of their product is rising faster than other products.
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U.S. real GDP per person grew rapidly in the early 1960s. The table above has U.S. real GDP and population for 1961 and 1962
a. What was U.S. real GDP per person in 1961? b. What was U.S. real GDP per person in 1962? c. Between 1961 and 1962, how rapidly did U.S. real GDP per person grow?
The owner of a productive resource is most usefully thought of as the person who
A) can appropriate the income from its use. B) can use it most efficiently. C) is willing to pay the most to obtain it. D) possesses legal title.
The political business cycle refers to the phenomenon that just before elections, politicians enact ________ policies. After the elections, the bad effects of these policies (for example, ________ ) have to be counteracted with ________ policies
A) expansionary; higher unemployment; contractionary B) expansionary; a higher inflation rate; contractionary C) contractionary; higher unemployment; expansionary D) contractionary; a higher inflation rate; expansionary
A market in which adverse selection occurs is often called a lemons market
a. True b. False Indicate whether the statement is true or false