In 2005, Hurricane Katrina destroyed oil and natural gas refining capacity in the Gulf of Mexico. This subsequently drove up natural gas, gasoline, and heating oil prices. As a result, this should
A) shift the short-run aggregate supply curve to the left.
B) shift the short-run aggregate supply curve to the right.
C) move the economy up along a stationary short-run aggregate supply curve.
D) move the economy down along a stationary short-run aggregate supply curve.
Answer: A
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A dominant strategy
A) is one that a firm is forced into following by government policy. B) involves colluding with rivals to maximize joint profits. C) involves deciding what to do after all rivals have chosen their own strategies. D) is one that is the best for a firm, no matter what strategies other firms use.
Refer to the above figure. If the economy is currently operating at point C, then there is
A) a stable long-run equilibrium situation. B) a recessionary gap. C) an inflationary gap. D) unemployment.
An incentive compensation scheme includes
a. a performance evaluation system b. a disciplinary action committee c. a reward system d. A and C
A country that must reduce current consumption to increase future consumption possibilities
A) must be allocating resources inefficiently. B) must be producing along the production possibilities curve. C) must be producing outside the production possibilities curve. D) must not have private ownership of property.