If a hurricane were to wipe out the majority of the eastern seaboard in the United States, it would likely cause a:
A. short-run supply shock.
B. long-run supply shock.
C. long-run demand shock.
D. short-run demand shock.
Answer: B
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Uni-Go Company makes motorized unicycles. Uni-Go is deciding whether to include a safety feature that would cost $6 for each unicycle
Uni-Go estimates the probability of death without the safety feature is 1/90,000 and the death cost per unicycle is $5.55. Uni-Go's cost-benefit recommendation is to A) add the safety device. B) not add the safety device. C) add the safety device plus additional safety devices. D) not produce the unicycle.
As residents of developing countries increase their chocolate consumption, the increased production of cocoa results in
A) increased opportunity cost of cocoa production. B) decreased opportunity cost of cocoa production. C) no change in production of other goods and services. D) increased production of other goods and services.
A monopoly incurs a marginal cost of $1 for each unit produced. If the price elasticity of demand equals -2.0, the monopoly maximizes profit by charging a price of
A) $1.00. B) $1.50. C) $2.00. D) $3.00.
Conditional convergence refers to the tendency for:
A. poorer countries to grow faster than richer countries given similar steady-state capital stocks, but the poor countries will never catch up with the rich countries. B. richer countries to grow faster than poorer countries given similar steady-state capital stocks, so the poor countries never catch up with the rich countries. C. poorer countries to grow faster than richer countries, but only if they receive sufficient foreign investment. D. countries with similar steady-state levels of output to grow faster when they're poor than when they're rich until their per capita GDP levels converge.