Long-run full-employment equilibrium assumes:
A. ?a downward-sloping production function.
B. ?a downward-sloping long-run supply curve (LRAS).
C. ?the CPI index price level equals the equilibrium wage rate.
D. ?the CPI equals aggregate demand (AD) equals short-run aggregate supply (SRAS) equalslong-run aggregate supply (LRAS).?
Answer: D
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For a given elasticity of demand, the less elastic the supply, the
A) larger the deadweight loss from a tax. B) larger the share of a tax paid by the sellers. C) greater the burden on the government from a tax. D) greater is the excess burden from a tax. E) larger the share of a tax paid by the buyers.
Which statement about price taker firms is correct?
a. Price taker firms cannot influence the price in the market. b. Price taker firms can influence the price in the market. c. Price taker firms are typically small and privately owned. d. Price taker firms are typically large and publicly owned.
A perfectly competitive firm's short-run supply curve is:
a. the segment of the marginal cost curve above average fixed cost. b. the upward-sloping segment of the marginal cost curve. c. both the segment of the marginal cost curve above average fixed cost and the segment of the marginal cost curve above the minimum level of average variable cost. d. the segment of the marginal cost curve above the minimum level of average variable cost.
Financial intermediaries are important because
A. they increase costs for banks. B. they employ large numbers of people. C. they bring lenders and borrowers together in a way that lowers transaction costs. D. they provide large funds to the stock market.