Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. If Country A were to divide its resources equally, it could produce:
A. 30 cars and 6 trucks.
B. 25 cars and 5 trucks.
C. 15 cars and 3 trucks.
D. 10 cars and 4 trucks.
C. 15 cars and 3 trucks.
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According to the short-run aggregate supply curve, if output minus potential output equals zero, then ________
A) unemployment might be zero B) inflation might be stable C) expected inflation must be stable D) price shocks must be zero E) none of the above
Public goods tend to be undersupplied through the market since it is difficult for potential suppliers to withhold such goods from nonpaying consumers; the government can use taxes to overcome this problem of nonpayment
a. True b. False Indicate whether the statement is true or false
Natural disasters (such as the 2011 earthquake and tsunami in Japan) are examples of an adverse supply shock, which result in the SRAS curve shifting leftward
Indicate whether the statement is true or false
What do economies of scale, the ownership of essential raw materials, and patents have in common?
A. They must all be present before price discrimination can be practiced. B. They are all barriers to entry. C. They all help explain why a monopolist's demand and marginal revenue curves coincide. D. They all help explain why the long-run average cost curve is U-shaped.