If the economy is represented in the graph shown and is currently at point E2, which action is the Fed most likely to undertake?
A. Contractionary monetary policy, because it will shift AD to the left.
B. Expansionary monetary policy, because it will shift AD to the right.
C. Expansionary monetary policy, because it will shift AD to the left.
D. Contractionary monetary policy, because it will shift AS to the right.
Answer: B
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Krystal runs a nail salon and needs to decide how many hours to stay open. Table 2.2 illustrates her marginal costs of staying open for each additional hour. Suppose that Krystal's marginal benefit of staying open per hour is $18
If she is following the marginal principle, how many hours should Krystal stay open? A) 3 hours B) 4 hours C) 6 hours D) 7 hours
In the loanable funds market, if the government is running a deficit
a. it is a supplier of funds as it is taking in more than it is spending b. it is a demander of funds as it is taking in more than it is spending c. it is a supplier of funds as it is spending more than it is taking in d. it is neither be a supplier or demander e. it is a demander of funds as it is spending more than it is taking in.
Efficiency wages
a. raise the productivity of a firm's workers, so the firm hires more workers. b. raise the productivity of a firm's workers, so the firm hires fewer workers. c. reduce the productivity of a firms' workers, so the firm hires more workers. d. reduce the productivity of a firm's workers, so the firm hires fewer workers.
Suppose McDonald's puts up five new stores in San Francisco using the exact same floor plan, capital equipment and number of workers, then the long run average cost curve of McDonald's would be ________ and the company experiences ________.
A. horizontal; constant returns to scale B. horizontal; economies of scale C. upward sloping; economies of scale D. horizontal; diseconomies of scale