An aggregate supply curve with a positive slope is associated with an economy in which:
a. input prices and final goods prices always change by the same amount
b. firms expect output prices to be unaffected by changes in input prices.
c. nominal wages and salaries do not change much in the short run.
d. firms expect consumer demand to be unaffected by changes in prices of final goods.
c
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Under conditions of perfect competition, if a profitable firm pushes its output beyond the point where MR equals MC,
a. profits increase. b. profits diminish. c. AFC increases. d. AVC decreases.
The price elasticity of demand between milk and soda is likely to be:
a. negative, because the goods are complements. b. positive, because the goods are complements. c. negative, because the goods are substitutes. d. positive, because the goods are substitutes. e. 0, because the goods are not usually consumed by the same person at one time.
GDP per capita is the best measurement for:
A. Determining the distribution of output within a country. B. Determining the growth rate of the economy over time. C. Finding the impact of population on GDP. D. Comparing living standards between countries.
Which of the following is an example of the rationing function of price?
A. A firm attempting to lower its explicit costs. B. Bill Gates purchasing the Mona Lisa for $5 billion. C. Government price controls. D. Switching from a Ph.D. in economics to one in finance because finance salaries are higher.