Based on the figure below. Starting from long-run equilibrium at point C, a tax increase that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at point ________ and eventually to a long-run equilibrium at point ________, if left to self-correcting tendencies.
A. D; C
B. D; B
C. A; B
D. B; C
Answer: B
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Refer to above figure. Given a tariff of $3 per unit, what is the country's consumer surplus?
What will be an ideal response?
The price level influences aggregate supply in the___ run but not in the ___run.
Fill in the blank(s) with the appropriate word(s).
Many economists believe that savings accounts should be added to M1 because they
A. are larger in size than conventional checking accounts. B. pay larger interest than checking accounts. C. can be transferred quickly into checkable accounts. D. are also insured by the federal government.
Author A accepts a $5,000 advance and a 10% royalty after 5,000 books are sold. Author B foregoes the advance and negotiates for a 15% royalty on all books sold. Author C decides to self publish his book and keep 50% of all sales revenue. Which of these authors is most likely to have 10 books published?
A) Author A B) Author B C) Author C D) They are all equally likely.