In a certain economy, toys and greeting cards are produced, and the economy currently operates on its production possibilities frontier. Which of the following events would allow the economy to produce more toys and more greeting cards, relative to the quantities of those goods that are being produced now?
a. The economy experiences economic growth.
b. There is a technological advance in the toy industry, but the greeting card industry experiences no such advance.
c. There is a technological advance in the greeting card industry, but the toy industry experiences no such advance.
d. All of the above are correct.
d
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If an import quota is imposed on imports of shrimp into the United States, U.S. producer surplus from shrimp will ________ and U.S. total surplus from shrimp will ________
A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease E) increase; not change
If Family Travel Agency, a monopolistic competitor, offers services that are differentiated from the services of other producers in the industry, it
a. faces a perfectly elastic demand curve b. is a price taker c. has some power to control the price it charges d. faces a perfectly inelastic demand curve e. produces a product with no close substitutes
Between 2007 and 2009, the U.S. unemployment rate rose from under 5 percent to over 8 percent. A Keynesian economist would most likely blame this increase in unemployment on:
A. an increase in the bargaining power of labor unions. B. a decline in the level of aggregate demand. C. a decline in aggregate supply. D. an increase in the minimum wage.
If average total cost is decreasing as more and more units are produced, then marginal cost must be
A. constant. B. below average total cost. C. rising. D. negative.