For each of the following scenarios, state the short-run effect on the AS curve
a. The price level decreases.
b. Lower inflation is expected in the future.
c. Worker productivity declines.
d. Oil prices increase.
e. The size of the labor force decreases.
a. A price level decrease will cause a movement down the AS curve.
b. Lower expected inflation will shift the AS curve to the right.
c. A decline in worker productivity will shift the AS curve to the left.
d. An increase in the price of oil will shift the AS curve to the left.
e. A decrease in the size of the labor force will shift the AS curve to the left.
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All games share three characteristics. Two of these characteristics are rule and strategies. What is the third characteristic called?
A) payoffs B) competition C) collusion D) results
When firms enter a monopolistically competitive market: a. product variety diminishes
b. the demand curves of established firms shift to the right. c. prices fall. d. profits increase.
Shocks to the economy often result in calls for government action to correct the imbalances these shocks create. Why don't markets tend to correct these imbalances quickly by themselves?
A. Government policy is the primary cause of shocks, so government policy is the only way to correct the imbalances they create. B. Product prices are often "sticky" or inflexible, keeping markets from correcting imbalances quickly. C. Prices adjust too quickly for markets to correct imbalances. D. Buyers and sellers in markets don't react rationally when shocks occur.
In 1995, the United States threatened to impose 100 percent tariffs on ________ from ________ if it didn't loosen its protectionist policies.
A. luxury cars; Japan B. auto parts; Japan C. brandies; France D. light trucks; Germany