Which of the following does not describe a characteristic of short-term economic fluctuations?
A. Expansions and recessions are irregular in length and severity.
B. Durable-goods industries are less sensitive to short-term fluctuations than service and non-durable industries.
C. Expansions and recessions are felt throughout the economy.
D. The unemployment rate rises during recessions.
Answer: B
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Suppose that initially there is no public debt. Using the above table, the public debt over this four year period would have
A) increased by $215. B) decreased by $100. C) increased by $1,375. D) decreased by $1,590.
A perfectly competitive firm would be willing to remain in the industry in the long run at zero economic profit because
A. its total revenues would be positive. B. accounting profit would be negative. C. revenue is equal to all costs, including the opportunity cost of capital and labor. D. its fixed costs would prevent it from leaving the industry.
The area between the market price and the demand curve provides a measure of: a. consumer surplus
b. producer surplus. c. consumer surplus plus producer surplus. d. marginal utility.
Which statement about the U.S. poverty line is true?
a. The poverty line is adjusted for the value of food aid. b. The poverty line is based on cash income. c. The poverty line varies from state to state. d. The poverty line fluctuates with Medicaid claims.