According to some economists, the protection granted to infant industries should be
a. terminated after one year.
b. for new firms that eventually would develop significant economies of scale in their production processes
c. restricted to firms that face little competition
d. based on current absolute advantage
e. permanent
B
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A chief purpose of long-term contracts is to improve agents'
A) information. B) incentives. C) control over principals. D) security.
Suppose the price level falls. Because of fixed nominal wage contracts, firms become less profitable and they cut back on production. This is a demonstration of the
A. classical dichotomy theory of the short-run aggregate-supply curve. B. sticky-wage theory of the short-run aggregate-supply curve. C. misperceptions theory of the short-run aggregate-supply curve. D. sticky-price theory of the short-run aggregate-supply curve.
Refer to Exhibit 2-2. If PPF2 is the relevant production possibilities frontier, then point __________ is productive efficient.
 ANSWER 8.png)
An increase in the price level cause aggregate demand to increase.
a. true b. false