To achieve long-run equilibrium in an economy with a recessionary gap, without the use of stabilization policy, the inflation rate must:
A. not change.
B. increase.
C. decrease.
D. either increase or decrease depending on the relative shifts of AD and AS.
Answer: C
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For a firm to be economically efficient from society's point of view, it should produce to the point at which
A) marginal cost equals marginal revenue. B) marginal cost equals average total cost. C) marginal cost equals price. D) average total cost equals price.
For the two year period ending in 2008-2009, what has been the number of bank failures?
a. About 500 b. About 2,000 c. Fewer than 150 d. More than 5,000 e. Fewer than 1,000
The demand for unionized labor will generally be more elastic, and it will be more difficult for the union to achieve above-equilibrium wages when
a. there are many close substitutes for the unionized workers. b. trade barriers limit the importation of the product produced by the unionized workers. c. the cost of employing the unionized workers is a small part of the total cost of product that they produce. d. the demand for the product produced by the unionized workers is highly inelastic.
All of the following are international (as opposed to domestic) policy goals for the United States except:
A. a balance of trade. B. an increase in exports relative to imports. C. a strong dollar. D. low inflation.