In the upward-sloping segment of the aggregate supply curve,
A. increases in output are linked to decreases in the price level.
B. firms are willing to pay higher wages to get more labor.
C. producers can hire more workers without having to raise the wage rate.
D. the economy can increase aggregate supply without prices going up.
Answer: B
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Refer to Figure 4-7. The figure above represents the market for iced tea. Assume that this is a competitive market. If the price of iced tea is $3
A) economic surplus is maximized. B) the quantity demanded is economically efficient but the quantity supplied is economically inefficient. C) too many consumers want to buy iced tea. D) the quantity supplied is greater than the economically efficient quantity.
Since the firm in the above figure is operating in a monopolistically competitive industry, in the long run we can expect to see
A) the typical firm's economic profits expand as production becomes more efficient. B) more firms entering the industry until economic profits are zero. C) the typical firm producing at the minimum point on its ATC curve. D) each firm expand its share of the total market.
Which of the following statements accurately characterizes American trade during the Revolutionary War?
a. The American colonies actively traded with France, Holland and Spain until 1778, when trade was hampered by British blockades. b. British blockades hampered the trade activities of first Northern and later Southern ports. c. American trade remained below pre-war levels. d. Decreases in imports led to increases in domestic production of textiles, beer and other products. e. Both b and c are correct.
During a recession, unemployment typically
a) falls slightly. b) does not change. c) falls substantially. d) rises.