Based on the figure below. Starting from long-run equilibrium at point C, a tax cut that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ and eventually to a long-run equilibrium at point ________, if left to self-correcting tendencies. 
A. D; C
B. B; C
C. B; A
D. D; B
Answer: D
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In the short run, which of the following is FALSE about the shutdown point?
A) Total revenue is equal to total fixed cost. B) Total revenue is equal to total variable cost. C) Product price is equal to the minimum average variable cost. D) Price multiplied by quantity must be equal to minimum average variable cost multiplied by quantity.
Which of the following tends to make demand for a good more elastic?
a. A reduction in the number of substitutes for the good. b. Consumers have a long time to adjust to a price change. c. The amount spent on the good is a small proportion of the consumer's budget. d. The good is broadly defined. e. The good is a necessity.
the principal-agent problem
What will be an ideal response?
Traveler's checks are included in:
A. M1 only. B. M2 only. C. both M1 and M2. D. neither M1 nor M2.