Refer to the figure below.________ inflation will eventually move the economy pictured in the diagram from short-run equilibrium at point ________ to long-run equilibrium at point ________, 
A. Rising; B; C
B. Falling; A; C
C. Falling; A; B
D. Rising; A; C
Answer: D
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Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential B. expansionary; higher; potential C. recessionary; lower; potential D. recessionary; lower; lower
A company finds that at the output level at which marginal cost equals marginal revenue, TC = $500, TVC = $400, and TR = $450. Your advice to the firm is
A) shut down, as TC > TR. B) reduce output to reduce the cost of production. C) increase output to reduce the per unit cost of production. D) continue to produce because loss is less than TFC.
Refer to the figure below. The socially optimal level of output could be achieved by imposing a tax on each unit equal to the distance ________. 
A. EG B. EF C. AC D. BC
Which of the following countries has the largest number of immigrants, as a percentage of the labor force (as of 2007)?
A. Austria. B. New Zealand. C. United States. D. Australia.