Because the price level does not affect the long-run determinants of real GDP, the long-run aggregate-supply is vertical
a. True
b. False
Indicate whether the statement is true or false
True
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If actual output is greater than the full-employment level of output, we should expect wages to increase over time
a. True b. False
The Grinch is now the mayor of your hometown, and he's still trying to steal Christmas. On the day after Thanksgiving, he announces a $25 tax on fresh Christmas trees. Tree farmers are angry to hear this because they have already delivered this season's
freshly cut trees to the tree lots in your town. You hear your neighbors planning to buy an artificial tree, and your family decides to drive to the next town to buy a tree. a . Who will bear the biggest share of the burden the first Christmas season this tax is in effect? Why? b. Will your answer change for subsequent Christmases? Why?
The demand for the Franconian franc in the foreign exchange market equals 11,000 - 25,000e and the supply of francs in the foreign exchange market equals 9,000 + 25,000 e, where e is the nominal exchange rate expressed in U.S. dollars per franc. If the franc is fixed at 0.25 U.S. dollars per franc, then the franc is ________ and Franconia has a balance-of-payments ________.
A. overvalued; surplus of 10,500 francs B. overvalued; deficit of 10,500 francs C. undervalued; surplus of 10,500 dollars D. undervalued; deficit of 10,500 francs
Which of the following statements is true about price ceilings?
A. Price ceilings cause goods to be rationed. B. Price ceilings cause goods to be rationed by some other means than legally determined market prices. C. Ration coupons are the only way to ration goods when price ceilings are in place. D. All of the other statements are correct.