According to the graph shown, what does P on the y-axis stand for?
A. Price of GDP
B. Inflation rate
C. Average price level
D. Price of Y
Answer: C
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When the rate of cyclical unemployment is zero, the
a. natural rate of unemployment must also be zero b. rate of frictional unemployment must be negative c. economy must have entered a recessionary stage d. Keynesian aggregate supply curve must be horizontal e. economy is considered to be at full employment
Refer to the figure at right. What can we say about economic? rent?
A. Economic rent equals the area HJKO B. Economic rent equals the area HJI C. Economic rent equals the area IJK0 D. There is no economic rent represented in the figure
Say a monopolist knew that at the current price for its product demand is inelastic. If marginal costs for this firm are zero, then in order to maximize profits this monopolist should
A. decrease its price. B. keep output at the same level. C. reduce output. D. increase output.
Assume point A on a linear production possibilities curve represents the combination of 12 coffees and 3 cappuccinos, and point B represents 3 coffees and 6 cappuccinos. Suppose coffees are on the vertical axis and cappuccinos are on the horizontal axis. The absolute value of the slope of the production possibilities curve between points A and B equals:
A. 4. B. 6. C. 3. D. 1/3.