The intersection between the long-run aggregate supply and aggregate demand curves determines the:
a. marginal product.
b. both level of full-employment real GDP, and average level of prices (CPI).
c. average level of prices (CPI).
d. level of full-employment real GDP.
b
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Suppose that during 2009, the actual real GDP of Chile was 3.5 billion pesos at the same time the potential GDP was 3.4 billion pesos. What sort of equilibrium existed in Chile?
What will be an ideal response?
Normative economics is
A) analysis involving value judgments about economic policies; or a statement of "what ought to be." B) analysis that is strictly limited to making either purely descriptive statements or scientific predictions. C) analysis of the behavior of the economy as a whole. D) decision making undertaken by households and business firms.
Should the government wish to lower the price of gasoline to the consumer, one approach might be
A) to raise the gasoline excise tax. B) to reduce the gasoline excise tax. C) to take action to shift the supply curve of gasoline to the left. D) to lower taxes on automobiles.
In the above figure, the firm will shut down if price falls below
A) F. B) I. C) H. D) E.