Monetary policymakers can respond to the impact that positive inflation shocks have on output by shifting the:
A. short-run aggregate supply curve to the left.
B. monetary policy reaction curve right.
C. monetary policy reaction curve left.
D. short-run aggregate supply curve to the right.
Answer: C
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Which of the following is true about competitive equilibria in environments where the conditions of the first welfare theorem are satisfied?
A. We have to be able to represent the demand side of the economy by a representative consumer. B. Consumer surplus is smaller than what would be estimated if it were measured on the market demand curve when goods are normal. C. Producer surplus is zero in the long run when all firms share the same technology. D. (a) and (b) are true. E. (b) and (c) are true. F. (a) and (c) are true. G. All of the above. H. None of the above.
Jenny's weekly income increases from $500 to $650. As a result, she goes out for dinner one day a week instead of one day every other week. What is Jenny's income elasticity of demand for restaurant dinners?
What will be an ideal response?
National defense is an example of a _____________________.
Fill in the blank(s) with the appropriate word(s).
What is the marginal cost to a copying business of making 1,000 copies (vs 0 copies) if it is estimated for each of the 1,000 copies made, the company will spend: $0.01 on paper, $0.01 on copier maintenance (i.e. varies with the number of copies), $0.02 on building rental, $0.01 on interest on borrowed money, and $0.003 on income and sales taxes?
a) $53 b) $43 c) $33 d) $23 e) $40