The classical notion of monetary neutrality is consistent both with a vertical long-run aggregate-supply curve and with a vertical long-run Phillips curve
a. True
b. False
Indicate whether the statement is true or false
True
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A decrease in capital outflows from the United States will
A) decrease the balance on the current account. B) decrease the balance on the financial account. C) increase the balance on the financial account. D) increase the balance on the capital account.
A decrease in government expenditure would shift the:
A) aggregate demand curve rightward. B) aggregate demand curve leftward. C) aggregate supply curve rightward. D) aggregate supply curve leftward.
Refer to the table below. If Fresh Laundry is currently producing 8 quality units, to maximize profit, Fresh Laundry should ________ the number of quality units as the current quality marginal revenue is ________ its marginal cost.
Fresh Laundry is a firm that produces laundry detergent. The table above summarizes Fresh Laundry's product quality marginal revenue and marginal cost at various quality levels.
A) increase; less than
B) maintain; greater than
C) increase; equal to
D) maintain; equal to
Assume a monopolist charges a price corresponding to the intersection of the marginal cost and marginal revenue curves. If this price is between its average variable cost and average total cost curves, the firm will:
a. earn an economic profit. b. continue to operate in the short run. c. shut down. d. all of these are true.