When actual output equals potential output there is ________ output gap and the rate of inflation will tend to ________.
A. an expansionary; increase
B. no; remain the same
C. an expansionary; decrease
D. a recessionary; increase
Answer: B
Economics
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Price-taking producers have horizontal marginal revenue curves.
Answer the following statement true (T) or false (F)
Economics
If a 6 percent decrease in the price leads to a 5 percent increase in the quantity demanded, the price elasticity of demand is
A) 0.30. B) 0.60. C) 0.83. D) 1.20.
Economics
The resource income earned by those who supply ________ is called wages
A) labor B) natural resources C) entrepreneurship D) capital
Economics
When a price ceiling is set below the equilibrium price, quantity demanded will exceed quantity supplied resulting in
a. excess demand or shortages. b. excess supply or surpluses. c. equilibrium prices. d. price controls.
Economics