Suppose the economy is in long-run equilibrium. If there is an increase in government purchases at the same time there is a large increase in the price of oil, then in the short-run
a. real GDP will rise and the price level might rise, fall, or stay the same.
b. real GDP will fall and the price level might rise, fall, or stay the same.
c. the price level will rise, and real GDP might rise, fall, or stay the same.
d. the price level will fall, and real GDP might rise, fall, or stay the same.
c
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Improved quality in health care services is partly responsible for increases in health care costs in the United States
Indicate whether the statement is true or false
Irene is a vegetarian, so she does not eat pork. That is, pork provides no additional utility to Irene. She loves broccoli, however. If we illustrate Irene's indifference curves by drawing broccoli on the horizontal axis and pork on the vertical axis, her indifference curves will
a. slope downward. b. be vertical straight lines. c. slope upward. d. be horizontal straight lines.
The theory of efficiency wages asserts that
a. employers set wages based on each employee's productivity. b. employers strive to hold wages below equilibrium levels. c. employers may find it profitable to pay above-equilibrium wages. d. efficient workers actually earn lower wages than those earned by inefficient workers.
An example of rent-seeking behavior would be:
a. streamlining production processes. b. lobbying legislators in charge of drafting business legislation. c. engaging in price discrimination. d. keeping prices below the profit maximizing level.