When new farmers enter the wheat industry, the equilibrium price of wheat
A. always falls.
B. falls only if existing firms gang up on the entrant.
C. falls only if existing firms are earning no economic profit.
D. falls only if the new firm is more efficient than existing firms.
Answer: A
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The fact that a person with a forceful and persuasive personality but not necessarily the greatest amount of knowledge and judgment can exercise a disproportionate amount of influence is a major drawback of
A) the Delphi method of forecasting. B) the market research method. C) opinion polling. D) the jury of executive opinion approach.
The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
One In the News article is titled "CBO's Flawed Forecasts." According to the text, the CBO's forecasts typically miss the actual budget balance in the fifth year by
A. 4 percent of GDP. B. 2 percent of GDP. C. 1 percent of GDP. D. 3 percent of GDP.
Shifts in demand away from French products and toward U.S. products (caused by forces other than changes in the exchange rate) would result in extra attempts to
A. buy euros and sell dollars. B. buy both euros and dollars. C. sell both euros and dollars. D. sell euros and buy dollars.