If Asian economies suffer a serious economic slump, U.S. net exports will
a. increase and AD will shift rightward.
b. increase and AD will shift leftward.
c. decrease and AD will shift leftward.
d. decrease and AD will shift rightward.
C
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A monopoly can arise when a large firm in an industry is able to take advantage of economies of scale in a way that leads to lower production costs and lower consumer prices
a. True b. False Indicate whether the statement is true or false
Why is a recession's end sometimes not announced for long periods after the recession ends?
a. Because economic data is seldom accurate. b. Because seasonal fluctuations and random disturbances make the economy difficult to track the differences between a temporary drop and a beginning of a downturn. c. Because people don't change their behavior even when the economy is in a downturn. d. No one knows why economists have a difficult time identifying the beginning and end of an economic downturn.
If a natural disaster were to cause a negative long-run supply shock to the economy, once the economy adjusts, the new equilibrium will be at a:
A. higher price level and lower level of output. B. lower price level and lower level of output. C. higher price level and higher level of output. D. lower price level and higher level of output.
Analysis indicates that the economy is in a recessionary gap. Which of the following is the most appropriate policy mix in this situation?
A. A budget surplus and expansionary monetary policy B. A budget deficit and expansionary monetary policy C. A budget deficit and contractionary monetary policy D. A budget surplus and contractionary monetary policy