Suppose OPEC is unable to come to an agreement regarding oil production and as a result the price of oil drops. Which of the following would you expect to occur as a result of this favorable supply shock?
a. The short-run Phillips curve will shift to the right and the unemployment rate will increase.
b. The short-run Phillips curve will shift to the right and the unemployment rate will decrease.
c. The short-run Phillips curve will shift to the left and the unemployment rate will increase.
d. The short-run Phillips curve will shift to the left and the unemployment rate will decrease.
d
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The above diagram shows the cost curves for a perfectly competitive wheat farmer
At what price(s) does the wheat farmer make an economic profit? Make zero economic profit? Incur an economic loss? How many bushels of wheat does the farmer produce if the price is $3 per bushel? If the price is $0.50 per bushel?
When Happy Feet Corporation announces that their fourth quarter earnings are up 10%, their stock price falls. This is consistent with the efficient markets hypothesis
A) if earnings were not as high as expected. B) if earnings were not as low as expected. C) if a merger is anticipated. D) the company just invented a new bunion product.
Which of the following occurs when insurance makes a person more likely to engage in risky behavior?
a. lemon problem b. moral hazard c. adverse selection d. risk selection
The short-run aggregate supply curve is positively sloped. Which of the following is not one of the explanations given in the text?
a. the misperception effect b. Sticky wage theory c. market effect d. All of the above are explanations of the profit effect.