If a natural disaster were to cause a negative long-run supply shock to the economy, once the economy adjusts, the new equilibrium will be at a:
A. higher price level and lower level of output.
B. lower price level and lower level of output.
C. higher price level and higher level of output.
D. lower price level and higher level of output.
Answer: A
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In the above figure, a price of $35 per dozen would result in
A) a shortage. B) equilibrium. C) a surplus. D) upward pressure on prices.
The LM curve shows points of equilibrium in the money market and combinations of
A) inflation and unemployment. B) aggregate supply and aggregate demand. C) income and the interest rate. D) money supply and money demand.
If Nike and Adidas are faced with the game in the figure, we can see that:
A. Nike has a dominant strategy, but Adidas does not.
B. Adidas has a dominant strategy, but Nike does not.
C. Neither company has a dominant strategy.
D. Both companies have a dominant strategy.
Government intervention in the farm economy that aims to create for farmers a constant or near constant level of purchasing power is called
a. partial rationing b. parity pricing c. income allotments d. price ceilings e. deficiency subsidization