Serious natural disasters like hurricanes and tornadoes cause widespread and extensive damage to buildings. As a result of a natural disaster, what would you expect to happen in the market for building supplies?
As homes and buildings are being reconstructed, the demand for building supplies will increase significantly. The increase in demand causes a movement along the supply curve, resulting in an increased quantity of building supplies traded. Prices will rise.
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When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline B. increase; raise; decline C. decline; lower; expand D. decline; raise; decline
Lower deductibles for employer-provided health care will tend to shift the ________ curve for medical services to the ________
A) supply; right B) demand; right C) supply; left D) demand; left
The main policy goal for a country according to the mercantilists is
A) to create a one-time deficit in the balance of payments. B) to create a continuing deficit in the balance of payments. C) to create a one-time surplus in the balance of payments. D) to create a continuing surplus in the balance of payments. E) to create specie overflows.
Good assumptions simplify a problem without substantially affecting the answer
a. True b. False Indicate whether the statement is true or false