An increase in foreign output would cause the domestic country's net exports to ________ and cause the domestic country's IS curve to ________
A) rise; shift up
B) rise; shift down
C) fall; shift up
D) fall; shift down
A
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When the economy responds to a supply shock, there is ________ in the short run and ________ in the long run between inflation and unemployment
A) an inverse relationship; no trade-off B) no trade-off; an inverse relationship C) an inverse relationship; an inverse relationship D) no trade-off; no trade-off
Replacing the simple Keynesian consumption function with the function based on the permanent-income hypothesis results in a ________ short-run multiplier, implying a ________ stable private economy
A) higher, more B) higher, less C) lower, more D) lower, less
Which of the following is true regarding tacit collusion?
A) It is a formal agreement. B) It is more likely to occur when the price elasticity of demand is small. C) It is more likely to occur when barriers to entry are low. D) It is illegal.
The long-run supply curve is upward sloping in a(n)
a. decreasing-cost industry b. increasing-cost industry c. constant-cost industry d. labor-intensive industry e. capital-intensive industry