Recall the Application about choosing a price for drones based on a linear demand curve to answer the following question(s).Recall the Application. Suppose a firm that produces drones has a linear demand curve for its product, with a vertical intercept of $1,500. If the firm initially charged a price of $500 and then raised its price to $750, the firm's total revenue would ________, and total cost would ________.
A. increase; increase
B. increase; decrease
C. decrease; increase
D. decrease; decease
Answer: B
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The demand for money is ________ related to the nominal interest rate
A) positively B) negatively C) not D) None of the above answers is correct because the relationship between the demand for money and the nominal interest rate changes with the inflation rate.
The income effect results in consumers increasing the quantity of normal goods demanded when the price falls
Indicate whether the statement is true or false
When the expenditure schedule is too high, the result is a(n)
A. unemployment surplus. B. inflationary gap. C. recessionary gap. D. budgetary gap.
Which would most likely increase aggregate supply?
a. A decrease in net exports b. A decrease in the prices of resources c. An increase in the degree of excess capacity d. A decrease in subsidies for businesses