Equilibrium GDP in excess of potential GDP eventually will cause the aggregate
A. demand curve to shift outward.
B. supply curve to shift outward.
C. supply curve to shift inward.
D. demand curve to become flatter.
Answer: C
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Ayanna grows herbs. Last year she grew 2,000 pounds of herbs in a year while using 250 square feet of land and 1 worker. This year she doubled her land to 500 square feet, doubled her workers to 2, and grew 4,500 pounds of herbs
She sells her rare, organic herbs for $50 a pound. She pays her workers $25,000 a year and rents her land for $100 per square foot for a year. These are her only costs. a) What was Ayanna's total cost last year and this year? b) What was Ayanna's average total cost last year and this year? c) Did Ayanna experience economies or diseconomies of scale?
In a perfectly competitive resource market the Marginal Revenue Product Curve is
A) vertical. B) horizontal. C) downward-sloping. D) upward-sloping.
The current-dollar GDP can be converted into a constant-dollar GDP by
a. adding a price index. b. subtracting a price index. c. multiplying by a price index. d. dividing by a price index.
With respect to the market clearing price and the equilibrium quantity for good B, an increase in the demand for and a decrease in supply of the good definitely will
A. increase the market clearing price and the equilibrium quantity of good B. B. increase the market clearing price of good B but have an uncertain impact on the equilibrium quantity of B. C. decrease the market clearing price and the equilibrium quantity of good B. D. increase the market clearing price of good B but lower the equilibrium quantity of B.