An economy in which output has decreased and prices have increased would suggest that there has been a:
A. negative demand side shock.
B. negative supply side shock.
C. positive demand side shock.
D. positive supply side shock.
Answer: B
You might also like to view...
Is it possible for a firm to have an absolute advantage in producing something without having a comparative advantage? Why or why not?
What will be an ideal response?
The flypaper effect is _____
a. that government grants get shifted around to other uses b. that government grants get spent on what they were intended to be spent on c. that government grants are used to lower tax rates d. that government grants are not used by local governments
We say that a good has elastic demand whenever the absolute value of the price elasticity of demand is greater than 1. A 1 percent change in price therefore causes
A) exactly a 1 percent change in the quantity demanded. B) a change of less than 1 percent in the quantity demanded. C) a greater than 1 percent change in quantity demanded. D) a change that cannot be determined based on 1 percent.
The production possibilities frontier is a graph that shows the various combinations of output that an economy can possibly produce given the available factors of production and
a. society's preferences. b. the available production technology. c. a fair distribution of the output. d. the available demand for the output.