Refer to the above figure. How do you describe what is happening as the economy moves from point A to point B?
A. The technology for growing wheat has improved.
B. Land that was once used to grow wheat is now being used to graze sheep.
C. The economy has acquired new resources that are well suited for producing wool.
D. The economy is producing more bread by choosing to produce less wool.
Answer: B
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Lily is a college student who likes to buy only two goods: Cheetos and Pepsi. To determine Lily's budget line, you need to know I. Lily's preferences for Cheetos and Pepsi. II. The prices of Cheetos and Pepsi. III. Lily's income
A) II only B) I and II C) II and III D) I, II and III
If the average total cost curve is always above the demand curve for a monopolist:
a. the profits of the monopolist will be large. b. the monopolist must be producing inefficiently. c. the monopolist will suffer economic losses. d. entry will occur, forcing the monopolist to reduce price and expand output.
If the price of domestically produced power tools increases, then
a. the consumer price index and the GDP deflator will both increase. b. the consumer price index will increase, and the GDP deflator will be unaffected. c. the consumer price index will be unaffected, and the GDP deflator will increase. d. the consumer price index and the GDP deflator will both be unaffected.
When the United States was under the gold standard, recessions were ________ and long-term inflation was ________
A) more frequent; virtually nonexistent B) less frequent; virtually nonexistent C) more frequent; prevalent D) less frequent; prevalent