In the aggregate demand/aggregate supply model, an increase in a country's sustainable potential output is represented by
a. an increase in aggregate demand.
b. a decrease in aggregate demand.
c. an increase in long-run aggregate supply.
d. an increase in the general level of prices.
C
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All of the following statements are true of the minimum efficient scale except one. Which one?
A) Any increase in the scale of operation will encounter either constant returns to scale or diseconomies of scale. B) All possible economies of scale have been exhausted. C) The short-run average total cost curve's minimum point is equal to the long-run average cost curve's minimum point. D) An increase in the output level will increase profit.
Demand-pull inflation can result when
A) policymakers set an unemployment target that is too high. B) a persistent budget deficit is financed by selling bonds to the public. C) a persistent budget deficit is financed by selling bonds to the central bank. D) workers get numerous wage increases.
NIPA means
A) New Income and Price Accounting. B) National Investment and Productivity Approach. C) Neutral Increase of Production Allocation. D) National Income and Product Accounts.
As applied to labor demand, the marginal approach to profit
a. is irrelevant b. requires setting marginal cost equal to the wage rate c. requires setting marginal revenue equal to the wage rate d. says that a firm should increase employment if doing so adds more to revenue than it adds to cost e. says that a firm should decrease employment if doing so adds more to cost than it adds to revenue