What do individuals have a strong incentive to do when price is the rationing criterion?
What will be an ideal response?
Provide goods and services to others in exchange for income.
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Use the following figure to answer the next question. 
Total fixed cost at output level Q2 is measured by the vertical distance
A. 0C. B. DE. C. AD. D. CD.
Suppose the economy is self-regulating and the (actual) unemployment rate is less than the natural unemployment rate. This means that the economy is producing a level of output
A) above its natural level and will eventually cut back on output. B) below its natural level and will eventually increase output. C) below its natural level but no forces exist to automatically increase output. D) above its natural level and institutional constraints will automatically be reduced so as to allow the economy to continue producing this level. E) none of the above
According to the new Keynesian sticky-price theory, a rise in aggregate demand results in ________ price level in the near term and in ________ price level in the longer term.
A. a lower; an unchanged B. a lower; a higher C. a higher; an unchanged D. an unchanged; a higher
If an unintended increase in business inventories occurs at some level of GDP, then GDP:
A. entails a rate of aggregate expenditures in excess of the rate of aggregate production. B. may be either above or below the equilibrium output. C. is too low for equilibrium. D. is too high for equilibrium.