To illustrate the classical argument that "supply creates its own demand," the aggregate supply curve should be drawn:
A. downward-sloping.
B. upward-sloping.
C. horizontal.
D. vertical.
Answer: D
You might also like to view...
The cost of producing a good or service that is paid by people other than the producers is
A) the marginal cost. B) represented by the demand curve. C) represented by the supply curve. D) an external cost.
Because of product differentiation in a monopolistically competitive market, the demand curve for an individual firm will be
A) horizontal. B) vertical. C) downward sloping. D) upward sloping.
When a competitive firm maximizes profit, it will hire workers up to the point where the
a. marginal product of labor is equal to the product price. b. marginal product of labor is equal to the wage. c. value of the marginal product of labor is equal to the product price. d. value of the marginal product of labor is equal to the wage.
Suppose that the price elasticity of supply is 0.5 and the price increases by 4%. We would predict:
A. an 8% increase in quantity supplied. B. a 2% increase in quantity supplied. C. a 0.8% increase in quantity supplied. D. a 0.2% increase in quantity supplied.