If aggregate supply meets aggregate demand in the vertical part of the AS curve, which of the following is a true statement about expansionary policies?
A) Monetary policy will be more effective in increasing output.
B) Fiscal policy will be more effective in increasing output.
C) Fiscal and monetary policy will be equally effective in increasing output.
D) Both monetary and fiscal policies will only cause prices to increase.
D
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The increase in spending that occurs because domestic goods become cheaper relative to foreign goods when the price level falls is known as the
A) interest rate effect. B) price effect. C) international trade effect. D) wealth effect.
Refer to Figure 12-1. If the firm is producing 500 units, what is the amount of its profit or loss?
A) profit equivalent to the area A B) loss equivalent to the area A C) profit of $280 D) There is insufficient information to answer the question.
Which one of the following will shift the investment demand curve leftward?
A. a technological breakthrough B. higher tax rates C. optimistic business expectations D. a lower rate of capacity utilization
Last year Christine worked as a consultant. She hired an administrative assistant for $15,000 per year and rented office space (utilities included) for $3,000 per month. Her total revenue for the year was $100,000. If Christine hadn't worked as a consultant, she would have worked at a real estate firm earning $40,000 a year.Last year, Christine's accounting profit was ________ and her economic profit was ________.
A. $49,000; $9,000 B. $9,000; 0 C. $100,000; $64,000 D. $64,000; $49,000