Figure 10-3
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In Figure 10-3, we would expect the aggregate supply curve in graph (b) to eventually
A. shift to the right, eliminating the recessionary gap.
B. shift to the left, eliminating the inflationary gap.
C. become steeper in the upper portion, eliminating the inflationary gap.
D. become flatter in the upper portion, eliminating the recessionary gap.
Answer: B
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Which of the following curves reflects the idea that in the long run, output is determined only by the factors of production and given technology?
A) the aggregate demand curve B) the long-run aggregate supply curve C) the Keynesian aggregate supply curve D) the market supply curve
Empirical evidence suggests that, when unemployment benefits run out, the probability that an unemployed person will find a job
A) remains constant. B) goes down by 20 percent. C) about doubles. D) about triples.
A firm has $200 million in total revenue and explicit costs of $190 million. Suppose its owners have invested $100 million in the company at an opportunity cost of 10 percent interest rate per year. The firm's economic profit is:
a. $400 million. b. $100 million. c. $80 million. d. zero.
A more efficient process for refining oil into gasoline is developed. As a result, the market price of gasoline: a. and the quantity of gasoline purchased both increase
b. increases and the quantity of gasoline purchased falls. c. decreases and the quantity of gasoline purchased rises. d. decreases and the demand curve for gasoline shifts to the right.