If the aggregate supply curve is steep,
A. increased aggregate demand will not lead to higher prices.
B. greater demand for labor will not cause significant wage increases.
C. business firms are probably producing near capacity.
D. All of these responses are correct.
Answer: C
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The Obama stimulus package was implemented to assist the economy in its recovery from recession. This package was designed to shift
A) aggregate demand to the left. B) aggregate demand and aggregate supply to the left. C) aggregate supply to the left. D) aggregate demand to the right.
Which of the following is possible in a 2-input production technology.
A. The technology has increasing returns to scale but diminishing marginal product of all inputs. B. The technology has increasing returns to scale but diminishing marginal product of all but one input. C. The technology has decreasing returns to scale but increasing marginal product of one input. D. (a) and (b) E. (a) and (c) F. (b) and (c) G. None of the above H. All of the above
Which of the following factors is fixed in the long run?
A) capital B) land C) entrepreneurship D) none of the above because all factors are variable in the long run
Give a scenario of a perfectly competitive firm finding the profit-maximizing level of output over a several-year period.
What will be an ideal response?