The economy pictured in the figure has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; A
B. recessionary; C
C. recessionary; B
D. expansionary; A
Answer: D
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List four protectionist policies
What will be an ideal response?
An insecure monopoly can deter another firm from entering the market by setting its quantity equal to:
A. the zero profit quantity. B. the zero profit quantity - the minimum entry quantity. C. the minimum entry quantity. D. the zero profit quantity + the minimum entry quantity.
If an outdoor vendor loses her job when winter weather comes, this individual is
A. structurally unemployed. B. seasonally unemployed. C. cyclically unemployed. D. chronically unemployed.
The existence of economies of scale is one reason oligopolies exist because
A. a firm is able to increase price leading to increased profits. B. the marginal cost decreases as output increases. C. as output increases average total cost decreases leading to large-scale firms. D. of strategic dependence.