Assume that the t-shirt industry is perfectly competitive. If the industry is in long-run equilibrium when the market price of t-shirts is $10:
A. minimum average variable cost equals marginal cost.
B. minimum long-run average total cost is less than $10.
C. minimum long-run average total cost is $10.
D. marginal cost exceeds $10.
Answer: C
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If the output gap equals -200 billion, then:
A. potential GDP is lower than actual GDP. B. there is no cyclical unemployment. C. cyclical unemployment equals the sum of structural and frictional unemployment. D. there is a recessionary gap.
The short-run Phillips curve portrays a(n):
a. direct relationship between total employment and the inflation rate b. inverse relationship between inflation and total employment. c. direct relationship between the unemployment rate and the inflation rate. d. inverse relationship between the unemployment rate and the inflation rate. e. inverse relationship between the price level and the unemployment rate.
Refer to Figure 5.4. Which consumption bundle would maximize the consumer's utility?
A. A
B. B
C. C
D. D
The World Bank defines extreme poverty as income of less than $1.90 per day per person.
Answer the following statement true (T) or false (F)