If the aggregate demand curve shifts in the short run moving the economy out of long-run equilibrium:
A. the short-run aggregate supply curve will shift to bring it back into long-run equilibrium.
B. inflation will always occur.
C. the aggregate demand curve will eventually shift back once expectations are taken into account.
D. we will move along the short-run aggregate supply curve back to equilibrium.
Answer: A
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Figure 14.6 represents the market for health insurance. Suppose there are two types of consumers, low-cost consumers with $2,000 average medical expenses per year, and high-cost customers with $4,000 average medical expenses per year. The insurance companies estimate that 40% of its customers are high-cost type. If the insurance companies set the price equal to their average cost per customer, what is the insurance companies' average cost per customer ($Y)?
A. $4,000 B. $3,400 C. $2,800 D. $2,000
The existence of diseconomies of scale (size) for the firm is hypothesized to result from:
a. transportation costs b. imperfections in the labor market c. imperfections in the capital markets d. problems of coordination and control encountered by management e. All of the above
Use the figure below to answer the following question.
At equilibrium, consumer surplus is
A. 400. B. 200. C. 150. D. 300.
The figure above illustrates a small country's production possibilities frontier. Moving from point A to point B, the per unit opportunity cost of a tablet is ________ per tablet
A) 2 computers B) 4/3 of a computer C) 100 computers D) 1/2 of a computer E) 1 tablet