Refer to the diagram. The initial aggregate demand curve is AD 1 and the initial aggregate supply curve is AS 1 . Assuming no change in aggregate demand, the long-run response to a recession caused by cost-push inflation is best depicted as a:
A. move from a to d along the long-run aggregate supply curve.
B. rightward shift of the aggregate supply curve from AS 2 to AS 1 .
C. move from a to c to d.
D. leftward shift of the aggregate supply curve from AS 1 to AS 2 .
B. rightward shift of the aggregate supply curve from AS 2 to AS 1 .
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The figure above shows the U.S. demand and U.S. supply curves for cherries. In the absence of international trade, how many pounds of cherries would U.S. farmers produce?
A) 200,000 pounds B) 400,000 pounds C) 600,000 pounds D) 800,000 pounds E) 0 pounds
The ability of a monopoly to charge a price that exceeds marginal cost depends on the
A) price elasticity of supply. B) price elasticity of demand. C) slope of the demand curve. D) shape of the marginal cost curve.
Which nation listed below is successfully transitioning from a planned economy to a hybrid market economy?
A. People’s Republic of China B. Japan C. United Kingdom D. United States
Differentiate between positive and negative incentives