Suppose the Federal Reserve increases the money supply. Which of the following will tend to occur as a result of this policy in a Keynesian model?
A) an inflationary gap
B) demand-pull inflation
C) a movement along the short-run aggregate supply curve
D) all of the above
D
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Suppose Aiyanna's Pizzeria currently faces a linear demand curve and is charging a very high price per pizza and doing very little business. Aiyanna now decides to lower pizza prices by 5% per week for an indefinite period of time. We can expect that each successive week
A. demand will become less price elastic. B. the elasticity of supply will increase. C. price elasticity of demand will not change as price is lowered. D. demand will become more price elastic.
Which of the following economic values is NOT an example of a price?
A) Wage earned per hour B) Annual interest rate paid for borrowed money C) College tuition per semester D) all are examples of prices
Trade, whether between individuals or nations, will not take place unless
A. there is one commodity and one currency. B. at least one participant expects to gain from the trade. C. both participants expect to gain from the trade. D. each side has an absolute advantage.
Reciprocity means:
A. responding to another's actions with a similar action. B. deriving utility from an action that will cause another's utility to increase. C. doing good things for people and asking nothing in return. D. deriving utility from the action of a stranger.