When there is an excess quantity of a product supplied, there will be
A. incentives for consumers to leave the market.
B. upward pressure on the price of labor.
C. a tendency for price of the product to fall.
D. a tendency for price of the product to increase.
Answer: C
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Three methods the government can use to cope with the external cost from pollution are
A) pollution taxes, subsidies, and outright bans. B) pollution taxes, regulations, and subsidies. C) marketable permits, pollution subsidies, and pollution taxes. D) pollution charges, marketable permits, and pollution limits. E) vouchers, pollution subsidies, and pollution taxes.
The GDP deflator is a measure of the price level which is calculated as nominal GDP divided by real GDP and multiplied by 100
Indicate whether the statement is true or false
Government spending and taxes
A) do not change aggregate demand. B) are an important component of aggregate supply. C) do not play a big role in determining GDP. D) are a major determinant of aggregate demand. E) cannot affect the price level.
In theory, the long-run supply curve for perfectly competitive market firms who are identical is:
A. downward sloping. B. perfectly elastic. C. upward sloping. D. perfectly inelastic.