Use the figure below to answer the following question.
The diagram concerns supply adjustments to an increase in demand (D1 to D2) in the immediate period, the short run, and the long run. Supply curves S1, S2, and S3 apply to the
A. short run, long run, and immediate period respectively.
B. long run, short run, and immediate period respectively.
C. immediate period, long run, and short run respectively.
D. immediate period, short run, and long run respectively.
Answer: B
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The banking system in the U.S. is based on:
A) 100 percent reserve banking. B) fractional reserve banking. C) 0 percent reserve banking. D) none of the above.
Speculators are primarily interested in
A) betting on anticipated changes in prices. B) reducing their exposure to the risk of price fluctuations. C) increasing market liquidity. D) reducing the spread between bid and ask prices on bonds.
Which is greater -- economic profit or accounting profit?
Which of the following is designated by points C’ and C in Exhibit 4?
a. Calvin and Wendy each benefit by specializing and trading their goods.
b. By specializing in food, Wendy can produce and trade 13 pounds of food per day.
c. In their exchange, the price of Wendy’s food is higher than the price of Calvin’s cloth.
d. Through trade, Wendy’s food production drops from 10 pounds to 7 pounds per day.