Suppose the economy had been operating along a given short-run Phillips curve for several years and then experienced a year of stagflation. The year of stagflation would:
a. be represented as a move upward along the short-run Phillips curve.
b. be represented as a move downward along the short-run Phillips curve.
c. be represented as a point above the short-run Phillips curve
d. be represented as a point below the short-run Phillips curve.
e. correspond to the origin.
c
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This graph depicts the demand for a normal good.
Suppose Johnny was consuming a normal good at point A in the figure shown, but has just received a raise at work. Johnny's demand may:
A. be unaffected.
B. increase to point B.
C. increase to point C.
D. drop to zero.
A decrease in the price of a good will cause a leftward shift of the demand curve, if it is a normal good
a. True b. False
Roger owns a small health store that sells vitamins in a perfectly competitive market. If vitamins sell for $12 per bottle and the average total cost per bottle is $11.50 at the profit-maximizing output level, then in the long run
a. more firms will enter the market. b. some firms will exit from the market. c. the equilibrium price per bottle will rise d. average total costs will rise.
The figure illustrates the market for coffee in Guatemala. With trade, total surplus in the Guatemalan coffee market amounts to
1, 250 b. 1,468 c. 1,870 d. 1,980.