If the inflation that results from targeting unemployment becomes unacceptably high, low inflation can be restored
Lower inflation can be obtained by ________ the growth rate of aggregate demand, by ________ money growth, and by________ interest rates.
A) lowering; accelerating; raising
B) raising; slowing; raising
C) lowering; slowing; raising
D) lowering; accelerating; lowering
E) lowering; slowing; lowering
C
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From the perspective of economic theory, prices are basically
A) constant. B) information signals C) rising. D) rates of exploitation.
Tommy's Teddy Bears incurs $300,000 per year in explicit costs and $50,000 in implicit costs. The shop earns $600,000 in revenues and has $1.1 million in net worth. Based on this information, what is accounting profit for Tommy's Teddy Bears?
A) $250,000 B) $300,000 C) $500,000 D) $1.35 million
If a competitive firm cannot earn profit at any level of output during a given short-run period, then which of the following is LEAST likely to occur?
A) It will shut down in the short run and wait until the price increases sufficiently. B) It will exit the industry in the long run. C) It will operate at a loss in the short run. D) It will minimize its loss by decreasing output so that price exceeds marginal cost.
Suppose the equilibrium price of oranges is $0.79 an orange, but government takes steps to prevent the price from exceeding $0.60 an orange. The likely result will be a:
A. shortage of oranges as the price ceiling keeps the market from reaching equilibrium. B. higher equilibrium price for oranges as the demand curve for oranges shifts to the right. C. lower equilibrium price for oranges as the supply curve for oranges shifts to the right. D. surplus of oranges as the price ceiling keeps the market from reaching equilibrium.