With no change in fiscal policy, the budget
A. will run a surplus during a recession and a deficit during a boom.
B. deficit will rise during a recession and fall during a boom.
C. deficit will fall during a recession and rise during a boom.
D. will remain unchanged by adverse economic conditions.
Answer: B
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In the long run, a monopolistically competitive firm and a perfectly competitive firm both produce at minimum average cost.
Answer the following statement true (T) or false (F)
Assuming that automobiles are normal goods, a rise in consumer income, other things being equal, will cause:
A. the demand curve for automobiles to shift to the left. B. the demand curve for automobiles to shift to the right. C. a downward movement along the demand curve for automobiles. D. an upward movement along the demand curve for automobiles.
If a consumer is given a $10 gift certificate good for items in store X, and all items in store X are inferior goods, then the consumer desires to consume:
A. fewer goods in store X. B. the same amount of goods in store X. C. more goods in store X. D. None of the statements is correct.
A year-long drought that destroys most wheat crops for the season would shift the:
A. short-run aggregate supply curve only. B. aggregate demand curve only. C. aggregate demand curve, and the short-run aggregate supply curve would shift in response. D. short-run aggregate supply curve and the long-run aggregate supply curve.