Figure 14-7
In , short-run equilibrium occurs
a.
at point a.
b.
at point b.
c.
at point c, where the actual price level exceeds the expected price level.
d.
at point c, where the actual price level is less than the expected price level.
c
You might also like to view...
JoAnn considers cola and plain sparkling water to be good substitutes. Suppose the price of sugar, a key ingredient used to produce cola, falls. According to the income effect, which of the following is most likely to occur?
a. JoAnn will purchase less cola and more sparkling water. b. JoAnn will purchase more cola and less sparkling water. c. JoAnn will purchase more of most goods due to her higher real income. d. JoAnn's demand curve will decrease (shift in), causing her to purchase less cola.
Individuals acting with self-interest:
a. always choose the same options as other rational individuals. b. never do voluntary work. c. always try to attain satisfaction at the expense of others. d. choose options that give them the greatest amount of satisfaction. e. have a perfectly elastic demand curve.
If demand is unit elastic, then a 10 percent increase in the price will lead to a 10 percent increase in quantity demanded
a. True b. False Indicate whether the statement is true or false
If elasticity of demand is 0.2, elasticity of supply is 0.5, and a 10 percent excise tax is levied on the good:
A. the tax burden on consumers will be greater. B. the tax burden on suppliers will be greater. C. the tax burden will be the same for both. D. one cannot say who will bear the greater burden without knowing the tax.