When prices of products are set below equilibrium,
A. society’s resources are inefficiently allocated.
B. firms expand output to increase profits.
C. firms earn excessively high profits.
D. consumers benefit from surpluses of cheap goods.
Answer: A
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In the above figure, the economy is at point A. Then the price level rises to 110 while the money wage rate remains constant. Firms will be willing to supply output equal to
A) less than $16.0 trillion. B) $16.0 trillion. C) more than $16.0 trillion. D) Without more information, it is impossible to determine which of the above answers is correct.
Ad valorem tariffs on imports are based on a percentage of an import's value; specific tariffs are based on a lump sum per physical unit imported
a. True b. False
If the actual inflation rate is equal to the expected rate, which of the following will happen?
a. inflationary expectations will increase and the Phillips curve will shift downward in the short run. b. inflationary expectations will not change and the Phillips curve will remain in its current position in the short run. c. inflationary expectations will decrease and the Phillips curve will shift downward in the short run. d. inflationary expectations will stay constant and the Phillips curve will shift downward in the short run. e. inflationary expectations will not change and the Phillips curve will become horizontal in the short run.
The U.S. government counts both cash income and in-kind transfers when determining the poverty rate.
Answer the following statement true (T) or false (F)