Allocative efficiency occurs when price ______.
a. is above the ATC curve
b. meets the ATC curve
c. is less than marginal cost
d. equals marginal cost
d. equals marginal cost
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The interest rate is the
A. rate of investment. B. price of credit. C. rate of return on investment in capital goods. D. expected rate of inflation.
Which of the following would be most likely to cause a reduction in the supply of Nintendo video games?
a. a decrease in the price of Nintendo video games b. a decrease in the price of computer chips used to make Nintendo games c. an increase in the demand for Nintendo video games d. an increase in the price of computer chips used to make Nintendo games
Suppose that, a country with a closed economy opens itself to international trade and becomes a net exporter. In that case, the price of that good will ________ when the economy goes from closed to open for trade.
A. decrease B. first decrease then increase C. increase D. stay the same
According to modern Keynesian analysis, an increase in aggregate demand leads to a higher price level because the
A. short-run aggregate supply curve is upward sloping. B. aggregate demand curve is upward horizontal. C. aggregate demand curve is upward sloping. D. short-run aggregate supply curve is vertical.