The slope of the budget constraint line is:
a. the ratio of the prices (px/py).
b. the negative of the ratio of the prices (px/py).
c. the ratio of income divided by price of y (I/py).
d. none of the above.
b
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The television network newscaster reports that the national inflation rate in the past year was equal to 4 percent. This report is most likely prepared from work done by a(n)
a. microeconomist b. normative economist c. macroeconomist d. econometrician e. social scientist rather than an economist
When price is below average variable cost, a firm in a competitive market will
a. shut down and incur fixed costs. b. shut down and incur both variable and fixed costs. c. continue to operate as long as average revenue exceeds marginal cost. d. continue to operate as long as average revenue exceeds average fixed cost.
A friend says, "I really, really need a new car." As an economist, you're thinking
A) Right! Everyone needs a new car. B) This is an example of how objectively undefinable needs are. Many would argue that this friend could get along just fine with a reliable used car. C) If this friend says she needs a new car, then we must all agree that a new car is a need and not just a want. D) that a new car can only be considered a need if at least 51% of the public agrees.
Natural gas is used as a source of energy in many manufacturing processes. Assume large new deposits of natural gas are discovered in Nebraska, which increase the supply of natural gas and decreased the price of natural gas. This would cause
A. the short-run aggregate supply curve to become nearly vertical at all levels of output. B. the short-run aggregate supply curve to shift to the left. C. the short-run aggregate supply curve to become flatter. D. the short-run aggregate supply curve to shift to the right.