An economy in which output has decreased and prices have decreased would suggest a:
A. decrease in short-run aggregate supply.
B. increase in aggregate demand.
C. increase in short-run aggregate supply.
D. decrease in aggregate demand.
Answer: D
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If a country is characterized by low life expectancy, low adult literacy, and low per capita energy consumption, it is likely:
A. an IAC. B. an LDC. C. neither an IAC nor an LDC. D. either an IAC or an LDC.
What is the relationship among the following variables for a perfectly competitive firm: the market price, average revenue and marginal revenue?
A) Average revenue is equal to the market price; average revenue is greater than marginal revenue. B) The market price is equal to both average revenue and marginal revenue. C) Average revenue is equal to marginal revenue; average revenue is greater than the market price. D) As a firm lowers the market price to sell more output, marginal revenue and average revenue will be less than the market price.
The shut-down decision is a short-run decision.
Answer the following statement true (T) or false (F)
Which of the following is an example of a bank functioning as a financial intermediary?
a. Bank A, which has a vault facility where its clients can keep their valuable documents b. Bank B, which has an excellent reputation for stability and sound investment c. Bank C, which pays its employees better than average salaries d. Bank D, which provides many small businesses with start-up capital