Producing a soccer ball costs Jake $5 . He sells it to Darby for $35 . Darby values the soccer ball at $50 . For this transaction, the total surplus in the market is $40
a. True
b. False
Indicate whether the statement is true or false
False
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The production possibilities frontier illustrates
A. the constant rate of technological progress. B. the fundamental concept of scarcity. C. the rapid growth of the U.S. economy. D. that guns always trade for butter.
Spending by consumers on consumption goods, spending by businesses on investment goods, spending by government, and spending by foreigners on net exports make up
a. disposable national income b. the equilibrium economy c. aggregate supply d. aggregate expenditure e. discretionary spending
If firms enter a purely competitive industry, then in the long run this change will shift the industry:
A. demand curve to the right, and the market price will increase. B. supply curve to the left, and the market price will increase. C. demand curve to the left, and the market price will decrease. D. supply curve to the right, and the market price will decrease.
During the recession of 2007-2009 in the United States, ________ relative to potential GDP
A) business fixed investment spending rose and net export spending declined B) consumption spending rose and residential construction spending declined C) federal government purchases rose and changes in business inventories declined D) net export spending rose and consumption spending declined