What could be a reason for a falling inflation rate?
a. Consumer optimism
b. A negative spending shock
c. Unemployment is below the natural rate
d. An increase in oil prices
e. A sudden increase in investment spending
B
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The above figure shows the Lorenz curves for four different countries. Which of the following statements CANNOT be made on the basis of the graph?
A) Incomes are distributed unequally in all four countries. B) Income distribution in country D is the most unequal among the four countries. C) Incomes are higher in country A than in country B. D) Income distribution is more equal in country B than in country D.
Lois sells ten sweaters she had knitted to a retail store. The gross domestic product (GDP) of her country _____
a. will increase b. will decrease c. will remain unaffected d. will increase only if the sweaters are as good as the sweaters sold by other retailers e. will increase if the price of each sweater is less than the cost of inputs required
Is the actual amount of output that corresponds to the long-run aggregate supply curve fixed? Explain.
What will be an ideal response?
Suppose a few powerful firms control all production in an industry and face identical demand and cost schedules. If they successfully collude and maximize joint profits, then price, output, and profit levels in the industry will be the same as those in:
A. monopolistic competition. B. an oligopoly with a kinked-demand curve. C. regulated monopoly. D. pure monopoly.