Which of the following is most important for the achievement of higher income levels and living standards?
A) production of additional goods and services that people value highly relative to the cost of their production
B) an increase in total employment
C) restriction of imports that expand employment in the protected industries
D) increases in government spending that create jobs
A) production of additional goods and services that people value highly relative to the cost of their production
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The Keynesian short-run aggregate supply (SRAS) curve
A) shows that real Gross Domestic Product (GDP) will increase only if the price level increases. B) is horizontal. C) assumes a full-employment level of real Gross Domestic Product (GDP). D) does not reflect any changes in nominal Gross Domestic Product (GDP).
"Expansionary fiscal policy is always 100 percent effective when the short-run aggregate supply curve is horizontal." Is this statement TRUE?
A) yes, because theoretically nothing else can offset the effects of fiscal policy B) yes, when the long-run aggregate supply curve is horizontal too C) no, because crowding out could take place D) no, because the increased spending may cause the price level to increase
At its present rate of output, 200 units, a perfectly competitive firm has total cost of $10,000 . marginal cost of $38, and fixed cost of $2,000 . and it charges the market price of $38 per unit. To maximize profit or minimize loss, this firm should
a. increase output b. reduce output but not to zero c. maintain the present rate of output d. shut down e. raise the price
A "Prisoners' Dilemma" game demonstrates how ____ is often rational for individuals even though ____
a. the failure to cooperate; cooperation would make everyone worse off b. the failure to cooperate; cooperation would make everyone better off c. cooperative behavior; cooperative behavior might make everyone worse off d. All of the above can be demonstrated with a "Prisoners' Dilemma" game.