Which of the following is true of a competitive market?
a. The rules of supply and demand do not apply to it
b. Buyers and sellers have little market power.
c. Each buyer's or seller's effect on market price is substantial.
d. Few sellers offer similar products.
b
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Recall the Application. As the world price of wool decreased, the quantity of wool supplied by individual ranchers would ________, and the quantity supplied in the whole market would ________
A) decrease; increase B) increase; decrease C) increase; increase D) decrease; decrease
If the quantity of real GDP supplied equals the quantity of real GDP demanded, then
A) nominal GDP must equal real GDP. B) real GDP must equal potential GDP. C) real GDP must be greater than potential GDP. D) real GDP might be greater than, equal to, or less than potential GDP. E) real GDP must be less than potential GDP.
A trend shows
A) the degree of correlation between two variables. B) the general tendency for a variable to rise or fall. C) the scale used to measure to variables. D) the increases in one variable.
Evidence in favor the Keynesian model would be that:
a. investment is not sensitive to changes in tax rates. b. labor supply is inelastic. c. the aggregate price level is positively correlated with income. d. all of the above. e. none of the above.