If the opportunity costs of producing a good increase as more of that good is produced, the economy's production possibility frontier will be
A. a negatively sloped straight line.
B. negatively sloped and "bowed inward" toward the origin.
C. negatively sloped and "bowed outward" from the origin.
D. a positively sloped straight line.
Answer: C
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The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
Do markets solve all of society's problems?
a. Yes, markets are efficient and work well under nearly all circumstances. b. Yes, markets solve the problems of production and distribution. c. No, they do not solve problems such as unemployment and inflation. d. No, they hardly solve any problems at all. e. Uncertain, economic theory has no answer to this question.
When individual supply curves shift, ceteris paribus, the market supply curve shifts.
Answer the following statement true (T) or false (F)
If the price were $15, how much would the firm's output be in the short run?
