The long run can be distinguished from the short run because in the long run
a) an equilibrium is reached between aggregate supply and aggregate demand
b) resources are no longer scarce
c) firms produce at capacity
d) the inflation rate is zero
e) technological advances come to an end
c) firms produce at capacity
You might also like to view...
A marginal benefit curve shows
A) the efficient use of resources. B) the quantity of one good that must be forgone to get more of another good. C) the quantity of one good that people are willing to forgo to get another unit of another good. D) there are increasing opportunity costs.
If real GDP is $13,500 billion and aggregate hours are 110 billion, labor productivity equals
A) $6.75 per hour. B) $104 per hour. C) $123 per hour. D) $675 per hour.
Quotas usually lead to larger deadweight losses than tariffs
Indicate whether the statement is true or false
The "equilibrating mechanism," the reason the economy tends toward equilibrium in the simple Keynesian model, is primarily
A) autonomous but flexible prices. B) production responses to unplanned inventory changes. C) exogenous inventory changes. D) endogenous price changes.