The short-run supply curve of a perfectly competitive firm is:
a. the average variable cost curve
b. the average total cost curve.
c. the same as the demand curve.
d. marginal cost above average variable cost.
d
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Assume that prices have risen in a given economy by an average of 5 percent over the last nine years. If consumers base their expectations about future price movements on that knowledge alone their forecasts rely on ________
A) reverse expectations B) adaptive expectations C) rational expectations D) monetary expectations
Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; potential C. higher; higher D. lower; higher
An upward-sloping supply curve implies that:
A. quantity supplied increases when price decreases. B. there is no relationship between price and quantity supplied. C. quantity supplied increases when price increases. D. the law of supply is invalid.
Macroeconomics involves the study of the decision-making of individual firms or individuals.
Answer the following statement true (T) or false (F)