Based on the figure below. Starting from long-run equilibrium at point C, a tax cut that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ and eventually to a long-run equilibrium at point ________, if left to self-correcting tendencies. 
A. D; C
B. B; C
C. B; A
D. D; B
Answer: D
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A vertical merger, like the merger of Seagate and Dell, would be attractive
a. only to Dell because it then avoids paying monopoly prices to Seagate. b. only to Seagate because it can then obtain two monopoly rents. c. to both Seagate and Dell but not to consumers who would find no difference in their welfare. d. to Seagate, Dell and consumers, all of whom would stand to benefit in some way.
If the data show that periods of high economic growth rate accompanied by high inflation rates, then changes in aggregate demand are the primary source of economic fluctuations
a. True b. False Indicate whether the statement is true or false
Exhibit 6-4 Total utility for multiplex tickets, video rentals, and popcorn Total Utilityfrom Multiplex Tickets Total Utilityfrom Video Rentals Total Utilityfrom Popcorn 1 movie (30 utils) 1 video (14 utils) 1 bag (8 utils) 2 movies (54 utils) 2 videos (24 utils) 2 bags (13 utils) 3 movies (72 utils) 3 videos (30 utils) 3 bags (15 utils) 4 movies (84 utils) 4 videos (32 utils) 4 bags (16 utils) In Exhibit 6-4, assume the Multiplex tickets cost $6 each, video rentals cost $2 each, and bags of popcorn cost $1 each. Suppose the consumer has $12 per week to spend on multiplex tickets, video rentals, and popcorn. What combination of goods will give the consumer the most utility?
A. 1 movie, 3 videos, and no popcorn. B. 1 movie, 2 videos, and 2 bags of popcorn. C. 1 movie, 1 video, and 4 bags of popcorn. D. 2 movies, no videos, and no bags of popcorn.
Which of the following correctly describes the effects of a decrease in net taxes?
What will be an ideal response?