In the long run, a year-long drought that destroys most of the summer's wheat crops causes permanently:
A. higher prices.
B. lower prices.
C. lower output.
D. None of these is true.
Answer: D
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Refer to Figure 18.3. The opportunity cost of producing pogo sticks in Livonia is
A) 2/3 of a scooter. B) 4/5 of a scooter. C) 6/5 scooters. D) 1.25 scooters.
Opportunity costs exist for
a. households but not businesses or governments. b. businesses but not households or governments. c. businesses and households but not governments. d. households, businesses, and governments.
If the money supply equals 1,000, velocity equals 5, and real GDP equals 2,500, then the price level equals:
A. 5. B. 2. C. 5,000. D. 2.5.
Suppose that televisions are produced both domestically and abroad. What would a ban on imported televisions do to the price of televisions, the quantity of televisions, and the output of the domestic television industry?
What will be an ideal response?