Potential GDP is an estimate of the economy's ability to produce goods and services if the
a. labor force is fully employed.
b. price level is stable.
c. trade balance is zero.
d. federal budget is balanced.
a
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An increase in the marginal product of capital shifts the
A) supply of capital curve rightward. B) supply of capital curve leftward. C) demand for capital curve rightward. D) demand for capital curve leftward.
A technological advancement has just occurred in the computer chip industry. In the computer chip market this will lead to
A) an increase in price and a decrease in quantity. B) an increase in price and an increase in quantity. C) a decrease in price and a decrease in quantity. D) a decrease in price and an increase in quantity.
If monopolistically competitive firms are earning economic profits, then in the transition to the long-run equilibrium: a. more firms will enter the industry
b. prices will tend to fall. c. each firm will produce a smaller quantity of output. d. all of the above will occur.
when a higher price level reduces the purchasing power of the public's accumulated savings balances
What will be an ideal response?