A positive temporary supply side shock will:
A. increase the level of potential output in the long run.
B. decrease the price level in the long run.
C. increase the price level in the long run.
D. have no effect in the long run.
Answer: D
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a. It cannot be applied to transfer programs. b. It does not apply to user charges. c. It is completely incompatible with efficiency. d. It closely resembles a market price.
When does the problem of adverse selection arise in any market?
In 2002, the United States placed higher tariffs on imports of steel. According to the open-economy macroeconomic model this policy should have
a. reduced imports into the United States and made U.S. net exports rise. b. reduced imports into the United States and made the net supply of dollars in the foreign exchange market shift right. c. reduced imports of steel into the United States, but reduced U.S. exports of other goods by an equal amount. d. reduced imports of steel into the United States and increased U.S. exports of other goods by an equal amount.
The American Federation of Labor is an example of a professional association.
Answer the following statement(s) true (T) or false (F)