A vertical aggregate supply curve was postulated by the classical economists because they believed that
A. the economy almost always had a large quantity of unemployed resources.
B. the economy could come to equilibrium at any level of output, not necessarily that level required to fully employ society's resources.
C. the economy naturally tended toward that level of output which would fully employ all resources.
D. it would be possible to increase output without driving up prices by putting unemployed resources to work.
C. the economy naturally tended toward that level of output which would fully employ all resources.
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Last year Christine worked as a consultant. She hired an administrative assistant for $15,000 per year and rented office space (utilities included) for $3,000 per month. Her total revenue for the year was $100,000. If Christine hadn't worked as a consultant, she would have worked at a real estate firm earning $40,000 a year. Last year, Christine's accounting profit was ________ and her economic profit was ________.
A. $64,000; $49,000 B. $100,000; $64,000 C. $9,000; 0 D. $49,000; $9,000
Necessities such as food and shelter have inelastic demand.
Answer the following statement true (T) or false (F)
In the last three decades, inflation has been relatively low in the U.S. economy, with the Consumer Price Index typically rising what percentage per year?
a. 1% to 2% b. 2% to 3% c. 2% to 4% d. 3% to 4 %
Suppose Ben owns a small company that makes kites. The market for kites is perfectly competitive, and kites sell for $25 each. Ben's total production costs vary depending on the number of kites he makes each day, as shown in the accompanying table.Number of kites Per DayTotal Cost Per Day ($)0100111021263148417252006235 If Ben's fixed cost rises, then in the short run, his:
A. profit-maximizing level of output will not change. B. profit-maximizing level of output will fall. C. economic profit will not change. D. profit-maximizing level of output will rise.