Suppliers would be less eager to organize to restrict output if they faced a:
A. more elastic demand.
B. perfectly inelastic demand.
C. less elastic demand.
D. unit-elastic demand curve.
Answer: A
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Which of the following indices best signals future movements in retail prices?
a. The implicit GDP deflator b. nominal GDP c. The consumer price index d. The producer price index e. The measure of economic welfare (MEW)
Which of the following is most important if the living standards of people residing in a country are going to improve?
a. growth of population b. growth of per capita GDP c. growth of the money supply d. growth of government expenditures as a share of GDP
In the horizontal segment of the aggregate supply curve, when GDP:
A. increases, the price level rises. B. decreases, the price level falls. C. increases, the price level does not change. D. increases, the price level falls.
When the economy operates with a recessionary gap, the economy is self-correcting; when the economy operates with an inflationary gap, the economy is not self-correcting.
Indicate whether the statement is true or false.