When factors of production move to better-paying sectors of the economy in the long run after the opening of trade in the country, wages and rents will be bid back to their pre-trade levels.
Answer the following statement true (T) or false (F)
False
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What is inflation and how is it measured using the Consumer Price Index?
What will be an ideal response?
Which of the following is a possible reason for the improved economic performance between 1985 and 2007?
A) Demand Shocks have become smaller and less important. B) Monetary and fiscal policy have become more effective. C) Change in conditions that make monetary and/or fiscal policy more powerful. D) All of the above
Refer to Figure 8.2. As the firm makes its long-run adjustment, which must be true?
A) It takes advantage of increasing returns to scale. B) It suffers from decreasing returns to scale. C) It takes advantage of increasing marginal product. D) It takes advantage of economies of scale. E) It takes advantage of diseconomies of scale.
If the price of pizza falls, the demand for pizza will rise
a. True b. False Indicate whether the statement is true or false