The aggregate supply curve indicates the
a. relationship between prices and the aggregate quantity of goods and services purchased by consumers, investors, governments, and foreigners (net exports).
b. relationship between prices and the natural rate of unemployment.
c. relationship between the real wage rate and the quantity of labor supplied by households.
d. quantity of goods and services producers will supply at different price levels.
D
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Cecilia's Café is in a competitive price-searcher market. Cecilia's is currently producing where average total cost is at its minimum, and Cecilia's is earning a positive economic profit. In the long run we would expect Cecilia's output to
a. decrease and average total cost to be higher. b. decrease and average total cost to be lower. c. remain unchanged as Cecilia's is doing the best it can. d. increase and average total costs to be lower.
One of the administrative bodies responsible for initiating actions on behalf of the U.S. government against individuals or companies violating antitrust laws is the
A. Interstate Commerce Commission. B. Federal Utility Commission. C. Department of the Interior. D. Federal Trade Commission.
When the Fed buys government securities, banks' reserves ________, the quantity of money ________, and the federal funds rate ________
A) decrease; increases; falls B) increase; increases; falls C) increase; decreases; rises D) decrease; decreases; rises E) increase; increases; rises
Homer's Holesome Donuts has determined that its profit-maximizing quantity is 10,000 donuts per year. Homer's earns $12,000 in revenue from the sale of those donuts. Homer's has two costs
First he pays $16,000 in annual rental payments for its five-year lease on its store. Second Homer incurs an additional cost of $5,000 for ingredients. Should Homer's shut down in the short run? A) Yes, because he is incurring an economic loss. B) Yes, because he cannot cover all of his fixed costs. C) No, because is making positive economic profit. D) No, because he can cover all of his variable costs.