A firm suffering short-run losses will continue to operate rather than shut down when price is less than its average variable costs.
Answer the following statement true (T) or false (F)
False
You might also like to view...
Starting from long-run equilibrium, a decrease in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. higher; potential D. lower; higher
In a closed economy, a decrease in the money supply will
A) shift the aggregate demand schedule to the left. B) shift the aggregate supply schedule to the right. C) shift the IS curve to the left. D) shift the LM curve to the right.
The real business cycle model suggests that, with aggregate demand unchanged, increases in output would be associated with ________
A) an increase in inflation B) a decline in inflation C) and unchanged price level D) procyclical inflation
When the Federal Reserve conducts open market purchases to increase bank reserves without trying to alter the interest rate that is already close to zero, the policy action is called
A) qualitative easing. B) quantitative easing. C) qualitative tightening. D) quantitative tightening.