If the economy is self-regulating, then it follows that
A) recessionary and inflationary gaps are temporary economic states.
B) wages will fall when the economy is in a recessionary gap.
C) wages will rise when the economy is in an inflationary gap.
D) the economy is always in long-run equilibrium.
E) a, b and c
E
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The figure above shows that as a result of the tariff, consumer surplus in the United States
A) decreases by $105 million per year. B) increases by $55 million per year. C) decreases by $30 million per year. D) decreases by $20 million per year. E) remains unchanged.
Quantity Demanded
What will be an ideal response?
Country A can produce either 2 tons of cocoa or 4 cars with 10 units of labor. Country B can produce either 5 tons of cocoa or 25 cars with 10 units of labor. Based on this information, which of the following is true?
(a) Country A has an absolute advantage in the production of cocoa, while Country B has a comparative advantage in the production of cocoa (b) Country A has a comparative advantage in the production of cocoa, while Country B has a comparative advantage in the production of cars (c) Country A has an absolute advantage in the production of cocoa, while Country B has a comparative advantage in the production of cars (d) Country A has a comparative disadvantage in the production of both goods (e) Neither country has a comparative advantage in the production of either good
Suppose that the elasticity of demand for a product is 0.5. What will happen to total revenue as a firm increases the price?
A. Total revenue will increase. B. Total revenue will decrease. C. Total revenue will stay the same. D. It cannot be determined from the information provided.