Refer to Figure 17-2. Suppose the Fed used expansionary policy to push short-run equilibrium to point B. If the short-run equilibrium remained at point B long enough,
A) the economy would move back to point A.
B) the short-run Phillips curve would shift down.
C) the economy would stay at point B in the long run.
D) the short-run Phillips curve would shift up.
D
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Assuming that the government cannot act immediately and the multiplier takes effect, ultimately creating an expansionary gap of $10 billion dollars. To close this gap, government purchases must be:
A. increased by more than $10 billion. B. increased by $10 billion. C. decreased by less than $10 billion. D. decreased by $10 billion.
If the marginal private cost of producing one kilowatt of power in California is ten cents and the marginal social cost of each kilowatt is fourteen cents, then the marginal external cost equals ________ per kilowatt
A) ten cents B) nineteen cents C) four cents D) zero cents E) fourteen cents
If the price of gasoline rose from $2.85 to $2.95 per gallon, your expenditure on gasoline would increase if your price elasticity of demand for gasoline equals
A) 1.25. B) 1.00. C) 0.75. D) Total revenue would increase at all of the above elasticities.
The value of a good to a consumer depends on
a. its total utility b. the marginal utility of the first unit consumed c. the average utility of the units consumed d. the marginal utility of the last unit consumed e. the ratio of its marginal utility to total utility