When a price ceiling is set below the equilibrium price,
a. the quantity demanded will exceed quantity supplied.
b. the quantity supplied will exceed the quantity demanded.
c. the quantity supplied will equal the quantity demanded.
d. the equilibrium price will fall.
a. the quantity demanded will exceed quantity supplied.
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Generally with bond ratings, the ________ the rating, the lower the interest rate an investor will receive and the ________ the risk that the issuer of the bond will default
A) higher; higher B) higher; lower C) lower; lower D) lower; higher
Refer to Figure 28-2. Suppose the economy is at point A in the figure above. Which of the following is true?
A) Actual inflation is 1%. B) The economy will move from A to B. C) The expected rate of inflation is 5.5%. D) The current unemployment rate is 3.8%. E) The current unemployment rate is equal to the natural rate of unemployment.
Monopolistically competitive firms
A) have market power because they can set price above marginal cost. B) have no market power because they earn zero economic profit. C) have no market power because of free entry. D) have no market power because price equals marginal cost.
Which of the following is most likely to increase the natural rate of unemployment?
a. An increase in the age of the working population b. A shift from service to manufacturing jobs c. An increase in the minimum wage rate d. A reduction in social security benefits e. A reduction in direct taxes