From mid-year 2006 to year-end 2008, housing prices
a. fell by approximately 30 percent, leading to a sharp reduction in aggregate demand.
b. increased by approximately 30 percent leading to a sharp increase in aggregate demand.
c. declined by a smaller about than in previous recessions.
d. were unchanged, but a sharp decline in stock prices reduced aggregate demand.
A
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A decrease in the interest rate will cause the intertemporal budget constraint to _______________ through the endowment point.
A. pivot clockwise B. pivot counter-clockwise C. shift clockwise D. shift counter-clockwise
Economies of scale can
A) result in an increasing cost industry. B) cause input prices to drop. C) prevent the entry of new firms into a market. D) reduce the rate of return which the firm may earn.
Which of the following is not correct?
a) During economic contractions most firms experience dwindling profits. b) Recessions come at irregular intervals and are almost impossible to predict. c) When real GDP expands, the rate of unemployment rises. d) Short-run fluctuations in economic activity can happen in developed countries such as the U.S.
A value of zero for the elasticity of supply of some product implies that
A) the supply curve is horizontal. B) supply is highly responsive to price. C) the product will not be supplied at any price. D) there is no supply. E) the supply curve is vertical.