When the market price is set below the equilibrium price:
A. total surplus is not maximized.
B. the market is not efficient.
C. producer surplus is decreased.
D. All of these are true.
Answer: D
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Marginal utility is best computed as the ratio of:
a. total utility to change in quantity consumed. b. the change in total utility to total quantity consumed. c. total quantity consumed to total utility. d. the change in total utility to change in quantity consumed.
The aggregate production function is the
a. relationship between the amount of labor employed in the economy and the total amount of output produced b. relationship between available labor and the total amount of output produced c. the relationship between land and capital and labor employed in the economy d. long-run equilibrium of the macroeconomy e. amount of output any worker can produce given existing land and capital constraints
If the dollar depreciates, it will cause ______.
a. an increase in exports and a decrease in imports b. a decrease in exports and an increase in imports c. a decrease in both imports and exports d. an increase in both imports and exports
Exhibit 14-4 Aggregate supply and demand curves
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As the economy moves to the right from E1 to E2 in Exhibit 14-4 along the upward-sloping aggregate supply curve the:
A. unemployment rate rises. B. unemployment rate falls. C. inflation rate falls. D. full employment GDP is realized.