The recession of 2007-2009 happened in part because, after the housing bubble burst in 2006, the ensuing financial crisis:
A. made it difficult for government to finance deficit spending.
B. led to widespread inflation.
C. shifted the PAE line upward.
D. increased the level of uncertainty about the future.
Answer: D
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Roaring Lion Studios can produce DVDs at a constant marginal cost of $5 per disk, and the studio has just releasing the DVD for its latest hit film, Ernest Goes to the Hamptons
The retail price of the DVD is $25, and the elasticity of demand for this film is -2. Has the studio selected the profit-maximizing retail price for this DVD? A) Yes B) No, the retail price is too low C) No, the retail price is too high D) We do not have enough information to answer this question.
The marginal revenue product (MRP) of land declines as more land is brought into use. As a result the:
A. demand curve for land is downsloping. B. demand curve for land is upsloping. C. supply curve for land is downsloping. D. supply curve for land is upsloping.
________ are not a barrier to entry.
A. Consent decrees B. Government franchises C. Patents D. Economies of scale
Demand-pull inflation occurs
A) when the aggregate supply curve shifts to the right, while aggregate demand remains stable. B) when the aggregate demand curve shifts to the right, while aggregate supply remains stable. C) when the aggregate demand curve shifts to the left, while aggregate supply remains stable. D) when the aggregate supply curve shifts to the left, while aggregate demand remains stable.