If the economy is operating along its long-run aggregate supply curve and aggregate demand increases, which of the following situations will occur?
a. Potential output will increase but the price level will remain constant
b. Both potential output and the price level will increase
c. Potential output will remain constant and the price level will increase
d. Both potential output and the price level will decrease
c
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Explain what economists mean when they apply the rationality assumption
What will be an ideal response?
Brian is the sole proprietor owner of Long Voyage Software, which generates maps for wilderness trips. He started the business with an initial investment of $80,000 . A faulty map caused one customer to get hopelessly lost. After her rescue and recuperation, she sued Long Voyage for $5,000,000 . Which of the following is true?
a. The customer can be awarded only $80,000--what the firm has available to pay. b. The customer can be awarded $5,000,000 but can get only $80,000. c. The customer can be awarded $5,000,000 . but Brian personally won't have to pay more than $80,000. d. If $5,000,000 is awarded, Brian will have to pay none of it. e. If $5,000,000 is awarded, Brian is personally responsible for paying all of it.
A study published in 2002 compiled evidence that using protectionism to save an average job in the textile and apparel industry would cost how much money per job saved?
a. $10,000 b. $50,000 c. $100,000 d. $199,000
During 2011 the inflation rate in Brazil was about 6.6% while in the U.S. it was about 3.3%. At the start of 2011 the nominal exchange rate was about 1.7 Brazilian real per U.S. dollar. If purchasing-power parity holds, about what should the nominal exchange rate have been at the end of 2011? Show your work