The sticky-price theory of the short-run aggregate supply curve says that if the price level rises by 5% and people were expecting it to rise by 2%, then firms have
a. higher than desired prices, which leads to an increase in the aggregate quantity of goods and services supplied.
b. higher than desired prices, which leads to a decrease in the aggregate quantity of goods and services supplied.
c. lower than desired prices, which leads to an increase in the aggregate quantity of goods and services supplied.
d. lower than desired prices, which leads to a decrease in the aggregate quantity of goods and services supplied.
c
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Economic inefficiency of a monopoly is indicated by
A) P = ATCmin. B) P > MR. C) P > MC. D) MR = MC.
In a zero-sum game
a. all players receive a $0 payoff b. all players can simultaneously win c. the gains to the winners equal the losses of the losers d. none of the above
With the creation of value, there is a
A. leftward shift of both the demand and supply curves. B. leftward shift of the demand curve and a rightward shift of the supply curve. C. rightward shift of the demand curve. D. leftward shift of the supply curve.
All of the following explain why purchasing power parity does not completely explain long-run fluctuations in exchange rates except
A) some countries impose barriers to trade. B) not all goods and services produced in any country are traded internationally. C) most countries have free markets with little, if any, government regulation. D) consumer preferences for goods and services differ across countries.