Other things equal, a positive supply shock would
a. Lower the price level
b. Increase real output
c. Shift AD right
d. Do a. and b. but not c.
d
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What will be an ideal response?
Evidence suggests that the marginal social cost of pollution reduction: a. increases as pollution reduction increases
b. remains constant as pollution reduction increases. c. decreases as pollution reduction increases. d. equals zero since it is beneficial to reduce pollution.
Which of the following will most likely have the greatest effect on an individual’s consumption function?
A. Winning a small amount in the lottery B. A one-time tuition grant C. A week of high overtime pay D. An inheritance paying a modest annual dividend
A monopolist will hire fewer workers than a perfectly competitive firm because
A) the marginal product curve decreases as additional units of labor are hired for a monopoly but not for a competitive firm. B) there is a variety of employers in a competitive market and only one in a monopoly. C) marginal revenue is greater than price for a monopoly while marginal revenue is equal to price for a competitive firm. D) to sell an additional unit of the good the competitive firm will keep the price the same while the monopolist must lower it on all units sold.