If aggregate demand increases and aggregate supply decreases, the price level ________.
A. will decrease, but real output may increase, decrease, or remain unchanged
B. will increase, but real output may increase, decrease, or remain unchanged
C. and real output will both decrease
D. and real output will both increase
Answer: B
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The money prices attached to goods in the economy
A) conceal the fact of their scarcity. B) make the goods artificially scarce. C) provide information about their scarcity. D) reflect the level of greed prevailing in particular markets.
In behavioral economics, salience is best exemplified by
A) consumers responding differently when posted prices increase rather than when prices increase because of sales tax increases. B) consumers responding the same regardless of how prices change. C) the end of a controlled experiment. D) consumers responding differently when income increases permanently rather than temporarily.
If a nation does not have an absolute advantage in producing anything, it
a. has no comparative advantage either. b. will have a comparative advantage in the activity in which it is least inefficient. c. will try to get along without trade. d. will export raw materials and import finished products.
A new firm enters a market which is initially serviced by a Bertrand duopoly charging a price of $30. Assuming that the new firm is equally as efficient as the incumbent firms, what will the new price be should the three firms coexist after the entry?
A. Equal to $30 B. Above $30 C. Below $30 D. Unable to tell given the information provided.