Advocates of discretionary economic policy are most likely to be
A. Keynesians.
B. supply-side economists.
C. rational expectationists.
D. Classical economists.
A. Keynesians.
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Which of the following would cause a shift in the supply curve to the left?
(a) An increase in consumer income. (b) New technology resulting in the cost of production falling. (c) An increase in the number of suppliers in the industry. (d) None of the above.
When critics of U.S. farm policy say that it treats symptoms rather than causes, they mean that the:
A. policy attempts to bolster low farm income, while the real problem is an overallocation of resources to agriculture. B. policy deals with the overallocation of resources to agriculture, while the basic farm problem is low incomes. C. policy attempts to bolster low farm incomes, while the real problem is an underallocation of resources to agriculture. D. restriction of output in the short run may reduce productive capacity in agriculture in the long run.
Firms in a monopolistically competitive industry produce:
a. homogeneous goods and services. b. differentiated products. c. competitive goods only. d. consumption goods only.
Suppose that Lady Gaga sells 1,000 tickets to a concerts at $480 each. If the equilibrium price is $600 per ticket for a fixed supply of 1,000 tickets, what is the value of the additional economic rent that Lady Gaga could earn if she charged the market clearing price?
A. $480,000 B. $1,080,000 C. $600,000 D. $120,000