Starting from long-run equilibrium, the long-run impact of a war that raises government purchases, compared to the original equilibrium, is:
A. higher inflation and higher output.
B. lower inflation and the same output.
C. lower inflation and lower output.
D. higher inflation and the same output.
Answer: D
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Which of the following activities undertaken by a competitive firm can improve its public relations?
a. Investing in assets that cannot easily be redeployed to other uses or locations. b. Donating a portion of its annual profit to hurricane affected families c. Providing good quality products at a high price. d. Investing in in-house research
If demand and supply both shift to the right, then:
A) both price and quantity will go up. B) price will go down and quantity will go up. C) quantity will go down and price will go up. D) quantity will go up, but price could go up, down, or stay the same
A government-sponsored good is one that
A. everybody will receive concrete benefits from. B. everybody is willing to support with funding contributions. C. is inherently valuable. D. the political process has determined socially desirable.
An example of third parties in the market of automobiles is
A) a pedestrian that is affected by the polluted air from automobiles. B) a seller of an automobile. C) a buyer of an automobile. D) None of the above belongs to third parties.