Suppose there was an unexpected increase in aggregate demand. We would expect to observe
A. a decrease in aggregate demand.
B. frictional unemployment to increase.
C. the duration of unemployment and the amount of unemployment to decrease.
D. higher wages, with the duration of unemployment and the amount of unemployment unchanged.
Answer: C
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If a good has an external cost, the
A) unregulated competitive market outcome is efficient. B) marginal private cost reflects the external cost. C) unregulated competitive market outcome is inefficient. D) marginal social benefit is equal to the marginal social cost when the market is in equilibrium. E) external benefit must equal the external cost.
If a farmer's opportunity cost of producing 10,000 bushels of wheat is 5,000 fewer bushels of soybeans, then her opportunity cost of producing 5,000 bushels of soybeans must be 10,000 fewer bushels of wheat
a. True b. False Indicate whether the statement is true or false
A price searcher confronts a downward sloping demand curve because
a. products in the market are differentiated. b. there is no close competitor in the market. c. the market is essentially monopolized. d. the firm gains nothing if it lowers its price.
In a recession Keynesians emphasize the need to ________ government spending or ________ taxes, which will cause a multiplier reaction.
A. decrease; decrease B. increase; increase C. increase; decrease D. decrease; increase