If the aggregate demand curve and the aggregate supply curve intersect at a level of real GDP less than potential GDP, there is
A) a recessionary ga
A
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What is a constant-cost industry? What does the long-run industry supply curve look like for a constant-cost industry?
What will be an ideal response?
Refer to Figure 9-8. Suppose the U.S. government imposes a $0.25 per pound tariff on rice imports. Figure 9-8 shows the demand and supply curves for rice and the impact of this tariff. Use the figure to answer questions a-i
a. Following the imposition of the tariff, what is the price that domestic consumers must now pay and what is the quantity purchased? b. Calculate the value of consumer surplus with the tariff in place. c. What is the quantity supplied by domestic rice growers with the tariff in place? d. Calculate the value of producer surplus received by U.S. rice growers with the tariff in place. e. What is the quantity of rice imported with the tariff in place? f. What is the amount of tariff revenue collected by the government? g. The tariff has reduced consumer surplus. Calculate the loss in consumer surplus due to the tariff. h. What portion of the consumer surplus loss is redistributed to domestic producers? To the government? i. Calculate the deadweight loss due to the tariff.
An increase in aggregate demand will have a smaller long-run effect on real GDP if the: a. aggregate demand curve is flat
b. short-run aggregate supply curve is horizontal. c. economy is well below potential output. d. economy is already at potential output. e. aggregate demand curve is fairly steep.
Karl Marx viewed socialism only as a transition to the ideal state of communism
a. True b. False Indicate whether the statement is true or false