Suppose the actual and expected price levels in an economy are initially equal. However, the actual price level becomes higher due to some change in economic conditions. Which of the following will occur eventually?
a. The economy will move rightward along the short-run aggregate supply curve.
b. The economy will move leftward along the short-run aggregate supply curve.
c. The short-run aggregate supply curve will shift to the right.
d. The short-run aggregate supply curve will shift to the left.
e. The short-run aggregate supply curve will become flatter.
d
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Use the following graph to answer the next question.
Which point is not on the perfectly competitive firm's short-run supply curve?
A. E B. F C. G D. H
Equilibrium in a perfectly competitive market results in the greatest amount of economic surplus, or total benefit to society, from the production of a good
Why, then, did Joseph Schumpeter argue that an economy may benefit more from firms that have market power than from firms that are perfectly competitive?
When the domestic currency strengthens under a fixed exchange-rate system, this is called
A) a depreciation. B) an appreciation. C) a devaluation. D) a revaluation.
Fracking involves:
A) extracting certain forms of energy from shale rock formations B) deep water drilling for energy with minimal externalities C) the reduction of menu costs thus allowing prices to adjust more freely D) breaking down the production of goods resulting in more competitive markets