Which of the following, other things the same, would make the price level decrease and real GDP increase?
a. long-run aggregate supply shifts right
b. long-run aggregate supply shifts left
c. aggregate demand shifts right
d. aggregate demand shifts left
a
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Refer to Figure 10-3. Best friends Laurel and Hardy both enjoy watching romantic comedies and science fiction movies. Based on the diagrams above what can you conclude about their movie preferences?
A) The diagrams do not provide any information about relative preferences. B) They have identical movie preferences. C) Hardy enjoys romantic comedies more than Laurel. D) Hardy enjoys science fiction movies more than Laurel.
In a market with a downward-sloping demand curve and an upward-sloping supply curve, a law requiring sellers to pay the government a tax of $1.00 per pack on cigarettes has the effect of:
A. shifting the supply curve to the right and increasing the price buyers pay by $1.00. B. shifting the demand curve to the right and increasing the price buyers pay by $1.00. C. shifting the supply curve to the left and increasing the price buyers pay by less than $1.00. D. shifting the demand curve to the left and increasing the price buyers pay by less than $1.00.
If elasticity of demand is 1.8, elasticity of supply is 0.7, and a 20 percent excise tax is levied on the good:
A. the tax burden on consumers will be greater. B. the tax burden on suppliers will be greater. C. the tax burden will be the same for both. D. one cannot say who will bear the greater burden without knowing the tax.
The price elasticity of supply is
A) negative. B) zero. C) positive. D) unknown, depending on other factors.