One reason for the short-run aggregate supply curve (SRAS) is:
a. a fixed CPI market basket
b. perfect knowledge of workers.
c. fixed-wage contracts.
d. the upward-sloping production function.
c
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Refer to Figure 4.1. Suppose Alvin chooses Bottom, while Simon chooses Up, and Theodore chooses Right. Alvin's payoff will be
A) 2. B) 6. C) 8. D) 16.
When a good commodity is driven out of the market by a bad commodity, the result is called:
a. moral hazard. b. adverse selection. c. positive externality. d. negative externality. e. the commons problem.
If profit-maximizing, this firm will charge a price of
A. $8.
B. $10.
C. $12.
D. $16.
Deficit spending occurs when
A. Net export spending alters macroeconomic outcomes. B. Consumers spend less than their income. C. Investment spending declines. D. Government spending becomes greater than the tax revenues collected.