According to the cost-push theory, what is responsible for inflation?
(A) The economy is operating as though there was a war.
(B) Too much money is in circulation.
(C) Demand for goods and services exceeds existing supply.
(D) Producers raise prices to meet increased costs.
Ans: (D) Producers raise prices to meet increased costs.
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Normative economics
A) predicts the consequences of alternative actions. B) answers the question "What ought to be?" C) answers the question "What is?" D) is the focus of most modern economic reasoning.
Offering product-specific services ________ consumer demand, shifting the market demand curve to the ________.
A) decreases; right B) increases; left C) increases; right D) decreases; left
If Harry's Blueberries, a perfectly competitive firm, shuts down in the short run, Harry must pay
a. variable cost but not fixed cost b. no costs at all c. variable cost and fixed cost d. only variable cost e. only fixed cost
Which of the reasons given for tariff protection make consumers better off by generating lower prices?
A) infant industry argument B) protecting U.S. jobs argument C) anti-dumping argument D) None provides lower prices for domestic consumers.