A decrease in the supply of money will lead to a(n)
A) increase in equilibrium real GDP and an increase in equilibrium price level.
B) increase in equilibrium real GDP and a decrease in equilibrium price level.
C) decrease in equilibrium real GDP and an increase in equilibrium price level.
D) decrease in equilibrium real GDP and a decrease in equilibrium price level.
Ans: D) decrease in equilibrium real GDP and a decrease in equilibrium price level.
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If a government wants to pursue an expansionary fiscal policy, then a tax cut of a certain size will be more expansionary when the
A. unemployment rate is low. B. economy's MPS is large. C. economy's MPC is large. D. economy's MPC is small.
When a resource supply curve slopes upward, as it usually does, earnings consist of both opportunity cost and ________ ________
a. actual costs b. economic rent c. actual pay d. it only consists of opportunity costs
This graph demonstrates the domestic demand and supply for a good, as well as the world price for that good.
According to the graph shown, if this economy was to engage in free trade, the good would:
A. not be imported or exported and only be produced domestically. B. no longer be produced domestically. C. be imported. D. be exported.
All of the following are assumptions of monopolistic competition EXCEPT
A. easy entry of new firms in the long run. B. many buyers and sellers. C. homogeneous product. D. profit-maximizing behavior.