Long-run macroeconomic equilibrium is achieved when the money wage rate has adjusted so that employment is such that real GDP equals potential GDP
Indicate whether the statement is true or false
TRUE
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What is the long-run average cost curve? What are the three ranges of output and in what order do they occur? Briefly define each of the three ranges
What will be an ideal response?
If the exchange rate between the dollar and Japanese yen is below the equilibrium exchange rate, there will be a ________ of dollars, and the exchange rate will ________
A) surplus; fall to the equilibrium level B) shortage; change only when the supply curve shifts leftward C) shortage; rise to the equilibrium level D) surplus; rise to the equilibrium level
Through correspondent banking, large banks provide services to small banks, including
A) loan guarantees. B) foreign exchange transactions. C) issuing stock. D) debt reduction.
A perfectly competitive firm has a random marginal cost with a 60 percent chance of a high marginal cost of $100 and a 40 percent chance of a low marginal cost of $90. What is the firm's expected marginal cost?
A) $94 B) $98 C) $92 D) $96