The basic reason that supply curves slope upward is that
a. demand curves slope downward
b. production is characterized by increasing costs
c. profits decline as product prices rise
d. greater output can only result from improved technology
e. price and quantity supplied are inversely related
B
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Refer to Figure 4.2. Use best-response analysis to answer the following question
If Ferris's choice placed us in the bowling alley, Sloane's best response, depending on the column she finds herself in, would include choosing all of the following cells except the one located at the ________ section of the appropriate payoff matrix. A) upper right B) upper left C) lower right D) lower left
In a diagram of aggregate demand and supply curves, the AD shortfall is measured as the
A. Horizontal distance between the aggregate demand curve necessary for full employment and the aggregate demand curve that intersects AS at the equilibrium price. B. Vertical distance between the recessionary GDP gap and the inflationary GDP gap. C. Horizontal distance between the equilibrium output and the full-employment output. D. Vertical distance between the equilibrium price and the price at which the aggregate demand would intersect aggregate supply at full employment.
Refer to the information provided in Figure 4.5 below to answer the question(s) that follow.
Figure 4.5Refer to Figure 4.5. Assume that initially there is free trade. If the United States then imposes a $10.00 tariff per CD-Rom drive on imported CD-Rom drives,
A. the quantity of CD-Rom drives supplied by U.S. firms will increase by 3 million. B. U.S. imports of CD-Rom drives will increase by 3 million. C. the quantity of CD-Rom drives demanded will be reduced by 6 million. D. the price of CD-Rom drives in the United States will decrease to $5.
If the Fed buys $32 billion of U.S. bonds in the open market and the reserve requirement is 10 percent, M1 will eventually
A. Decrease by $320 billion. B. Increase by $32 billion. C. Decrease by $32 billion. D. Increase by $320 billion.