If Les can produce two pairs of pants per hour while Eva can produce one pair per hour, then it must be true that:
A. Les has both comparative and absolute advantage in producing pants.
B. Les has a comparative advantage in producing pants.
C. Les has an absolute advantage in producing pants.
D. Eva has a comparative advantage in producing pants.
Answer: C
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If the natural unemployment rate decreases, then the short-run Phillips curve ________ and the long-run Phillips curve ________
A) does not shift; shifts leftward B) shifts leftward; shifts leftward C) shifts rightward; shifts rightward D) shifts leftward; does not shift E) shifts rightward; shifts leftward
The board of directors of Fast Food Inc, have the final say in all decisions made for the firm. Market conditions and recent poor performance has caused some discord among the board members. Which of the following statements is likely to be true?
a. The decisions the board members take may lead to compromises that are not in the interests of the shareholders. b. Decision-making will be decentralized in this firm. c. People lower in the hierarchy of this firm will be better equipped to take decisions. d. The board's incentives are aligned with those of the firm's principals.
A year-long drought that destroys most wheat crops for the season would shift the:
A. short-run aggregate supply curve only. B. aggregate demand curve only. C. aggregate demand curve, and the short-run aggregate supply curve would shift in response. D. short-run aggregate supply curve and the long-run aggregate supply curve.
The firm's shutdown point is
A. at point J.
B. at point K.
C. between points J and K.
D. above point K.