A weakness in the concept of GDP is that it ignores income distribution.
Answer the following statement true (T) or false (F)
True
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Based on the figure below. Starting from long-run equilibrium at point C, a decrease in government spending that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at__ creating _____gap.
A. B; no output B. D; an expansionary C. B; recessionary D. D; a recessionary
Full employment is the situation in which the economy operates at an unemployment rate equal to the sum of:
a. structural and frictional unemployment. b. cyclical and frictional unemployment. c. structural and cyclical unemployment. d. structural, frictional, and cyclical unemployment.
If the several oligopolistic firms that comprise an industry behave collusively, the resulting price and output will most likely resemble those of:
A. bilateral monopoly. B. pure monopoly. C. monopolistic competition. D. pure competition.
In markets characterized by monopolistic competition,
A. entry into the market is restricted so that profit may be positive in the long run. B. a small number of relatively large firms sell a standardized product. C. a small number of relatively small firms sell a differentiated product. D. entry into the market is relatively easy so that profit in the long run is zero.