If the demand for tennis shoes increases and a firm's supply curve is upward sloping, then:
A. producer surplus decreases.
B. producer surplus does not change.
C. producer surplus increases.
D. producer surplus may either increase or decrease.
Answer: C
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In the aggregate demand-aggregate supply framework, how does an increase in the price level affect potential GDP?
What will be an ideal response?
The Clean Air Act is designed to restrict automobile emissions and reduce the external costs of air pollution. The economic analysis used to develop the Clean Air Act was:
A) normative. B) positive. C) macroeconomic. D) none of the above
Supply-side economists argue cuts in tax rates
A) always reduce tax revenues. B) may increase tax revenues. C) always increase budget deficits. D) have no effect on tax revenues.
Scarcity always exists because
a. machines and people are inefficient. b. changes have occurred in global weather patterns. c. our needs and wants are not limited, but our resources are limited. d. there are more poor people than rich people.