Refer to Figure 23.2 for a perfectly competitive firm. This firm will maximize profits by producing the level of output that corresponds to point
A. A.
B. B.
C. C.
D. D.
Answer: C
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The short-run aggregate supply curve has a
A) negative slope. B) positive slope. C) slope equal to zero. D) slope equal to infinity.
Suppose the United Auto Workers' Union succeeded in obtaining a 10 percent increase in the wages of its workers and that the wage increase caused automobile prices to rise. Employment in the auto industry would be most likely to decline significantly if
a. the demand for American-made automobiles was highly elastic. b. the supply of foreign-produced automobiles was highly inelastic. c. American consumers considered foreign automobiles a poor substitute for American automobiles. d. the demand for American automobiles was relatively constant and highly inelastic.
As a result of GATT, tariff rates in developed countries have decreased from 40 percent in 1948 to less than 4 percent today.
Answer the following statement true (T) or false (F)
One of the reasons that Real Gross Domestic Product is not synonymous with social welfare is
A. it treats all spending the same (spending on military hardware is treated the same as spending on education). B. quality has remained steady. C. things produced by people under 18 are not counted. D. people substitute between goods.