In the diagram of the production function, a beneficial supply shock is shown by
A. an upward shift in the production function.
B. a downward shift in the production function.
C. a movement up along the production function.
D. an increase in the convexity of the curve.
Answer: A
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a. Trade restrictions make all Americans better off. b. Trade restrictions increase economic efficiency. c. Trade restrictions are necessary for economic growth. d. Trade restrictions are sometimes necessary for national security.
Which of the following reasons can explain why purchasing power parity doesn't hold?
A. Transactions costs B. Fixed prices C. Political pressures D. All of these are reasons why purchasing power parity doesn't hold.
In the following question you are asked to determine, other things equal, the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for, or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the
equilibrium quantity (Q) of X. Refer to the given information. An increase in the price of a product that is a close substitute for X will: A. decrease D, increase P, and decrease Q. B. increase D, increase P, and decrease Q. C. increase D, increase P, and increase Q. D. increase D, decrease P, and increase Q.
The government weighs the potential cost savings resulting from a merger against the potential anticompetitive problems to determine whether or not to allow a merger to take place.
Answer the following statement true (T) or false (F)