In the long run, a decrease in the money supply growth rate
a. shifts the short-run Phillips curve left so inflation returns to its original rate.
b. shifts the short-run Phillips curve left so unemployment returns to its natural rate.
c. Both A and B are correct.
d. None of the above is correct.
b
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Use the following graph, where Sd and Dd are the domestic supply and demand for a product and Pc is the world price of that product to answer the next question.
Sd + Q is the product supply curve after an import quota is imposed. The size of the import quota
A. is y?w. B. is y?v. C. is z?v. D. cannot be determined.
In an extreme hypothetical instance in which the price change of a good elicited no change in quantity demanded, we would say that the item is
A) perfectly elastic. B) perfectly inelastic. C) infinitely elastic. D) unitary elastic.
A measure of sensitivity or responsiveness to changes in price or income is called:
a. elasticity. b. technology. c. supply and demand. d. social pressure. e. kickback.
Deadweight losses occur in markets in which
a. firms decide to downsize. b. the government imposes a tax. c. profits fall because of low consumer demand. d. equilibrium prices fall.