Refer to Figure 4.1. A shift from S1 to S2 will result from all of the following except
A) a decrease in the government's budget deficit.
B) a decrease in net exports.
C) a decrease in corporate taxes.
D) a decrease in the desire of households to consume today.
C
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Starting from long-run equilibrium, a decrease in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. higher; potential D. lower; higher
Jaime's father gives her a pen for her graduation from college, but Jaime wants a smartphone. This implies that
A) Jaime's father is not acting out of self-interest because he knows that she really wants a smartphone. B) Jaime's father is acting out of self-interest because he wants to give her something useful. C) Jaime is not acting out of her self-interest by wanting something different from what her father gives her. D) Jaime is not rational by asking for a smartphone instead of a pen.
The short-run average total cost (ATC) curve of a firm will tend to be U-shaped because
a. larger firms always have lower per-unit costs than smaller firms. b. at low levels of output, AFC will be high, while at high levels of output, MC will be high as the result of diminishing returns. c. diminishing returns will be present when output is small, and high AFC will push per-unit cost to high levels when output is large. d. diseconomies of scale will be present at both small and large output rates.
When referring to GDP, which is not a common alternative designation economists use?
A. Aggregate Expenditure B. Net National Income C. National Income D. Total Output