Refer to the following graph.
If the price is set at Pc:
A. a nonprice rationing mechanism must determine which producers will be able to sell the product.
B. a nonprice rationing mechanism must determine which buyers will be able to purchase the product.
C. the demand curve will shift to the left to achieve a new equilibrium.
D. anyone willing and able to pay the asking price will be able to purchase the product.
Answer: B
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At the beginning of a recession, the expenditure multiplier
A) offsets the initial cut in autonomous expenditure and slows the recession. B) has no effect on the recession. C) offsets the initial cut in autonomous expenditure and reverses the recession. D) reinforces the initial cut in autonomous expenditure and reverses the recession. E) reinforces the initial cut in autonomous expenditure and adds force to the recession.
The ability to produce a good at a lower opportunity cost than another producer is called
A) absolute advantage. B) comparative advantage. C) specialization. D) protectionism.
Which of the following is true?
A. Frictional unemployment implies a lack of available jobs. B. During a recession, cyclical unemployment will be low. C. When an economy is at full employment, actual unemployment will be less than the natural rate of unemployment. D. When actual GDP equals potential GDP, the actual unemployment rate will equal the economy's natural rate of unemployment.
Which of the following is not an advantage of starting a new business as a partnership?
A) The owners have complete control over the business. B) A partnership has few government rules and regulations to comply with. C) Business profits are only taxed once, not twice. D) A partnership can easily attain additional funding.