Under monopoly, resources are allocated as efficiently as in perfect competition.
Answer the following statement true (T) or false (F)
False
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Land used for commercial Christmas trees can also produce pulpwood. Therefore, an increase in the expected market price of Christmas trees tends to
A) reduce the demand for Christmas trees. B) increase the supply of Christmas trees. C) increase the cost of producing pulpwood. D) decrease the cost of producing pulpwood.
If it takes more dollars to acquire one unit of a foreign currency,
A) the quantity of U.S. good that the foreign country will by will decrease B) the foreign currency has depreciated. C) the dollar has depreciated. D) the dollar has appreciated.
What effect does restrictive monetary policy have on short-term real interest rates?
a. Restrictive monetary policy tends to push short-term interest rates upward. b. Restrictive monetary policy tends to push short-term interest rates downward. c. The effect of restrictive monetary policy on short-term interest rates is unpredictable. d. Restrictive monetary policy has no effect on short-term interest rates.
Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y1. C. P3 and Y1. D. P3 and Y2.