Suppose the IS curve shifts back and forth. With a steep LM curve you get __________ variability in the interest rate and __________ variability in output than you get with a flat LM curve
A) more; more
B) more; less
C) less; more
D) less; less
C
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The above figure shows the costs at Barney's Bagel Bakery. For which of the following levels of output does the average product of labor exceed the marginal product of labor?
A) at 1000 bagels daily B) at 2000 bagels daily C) at 3000 bagels daily D) all of the above
Draw the demand curve for a good whose price elasticity of demand is equal to infinity. Be sure to label both axes.
What will be an ideal response?
Answer the following questions true (T) or false (F)
1. If a state requires all drivers to buy auto insurance, the problem of adverse selection is eliminated. 2. Adverse selection is a situation in which one party to a transaction takes advantage of knowing more than the other party to the transaction. 3. A doctor pursuing his own interests rather than the interests of his patients is an example of the principal-agent problem.
How does the increasing use of digital cameras affect the market for traditional camera film?
A) The quantity of traditional camera film demanded decreases. B) The demand curve for traditional camera film shifts to the left. C) The quantity of traditional camera film demanded increases. D) The demand curve for traditional camera film shifts to the right.