If fluctuations in economic activity emanate from the supply side, higher rates of inflation will be associated with higher rates of unemployment, and lower rates of inflation will be associated with lower rates of unemployment.
Answer the following statement true (T) or false (F)
True
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Short run economic costs must be lower than long run economic costs because long run economic costs include the cost of inputs that are fixed in the short run (and thus are not part of short run cost).
Answer the following statement true (T) or false (F)
Lars is CEO of a large monopolistic firm. He looks at what is going on with revenues and pricing, and being knowledgeable about running a monopoly, he decides to reduce production. What does this tell us about his firm?
a. Marginal cost is equal to marginal revenue. b. Marginal revenue is exceeding marginal cost. c. Marginal cost is exceeding marginal revenue. d. Marginal revenue is equal to price.
If quantity demanded for sneakers falls by 6 percent when price increases 20 percent, we know that the absolute value of the own price elasticity of sneakers is:
A. 2.3. B. 0.3. C. 0.7. D. 3.3.
In Figure 22.2, which area represents consumer surplus to the smoker? 
A. 0ACQ* B. 0P*CQ* C. 0BCQ* D. AP*C