Using Figure 1 above, if the aggregate demand curve shifts from AD2 to AD3 the result in the short run would be:
A. P1 and Y2.
B. P2 and Y3.
C. P3 and Y1.
D. P2 and Y2.
Answer: B
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What are the two tools of fiscal policy that governments can use to stabilize an economy?
A) taxation and controlling exports B) government spending and taxation C) government spending and technology improvements D) taxation and controlling imports
The above figure shows a payoff matrix for two firms, A and B, that must choose between a high-price strategy and a low-price strategy. For firm A,
A) setting a low price is the dominant strategy. B) setting a high price is the dominant strategy. C) setting a high price when firm B sets a high price, and setting a low price when firm B sets a low price is the dominant strategy. D) setting a high price when firm B sets a low price, and setting a low price when firm B sets a high price is the dominant strategy.
Henry George advocated each of the following except that
A. all land should be free. B. all rents should be taxed away. C. the government should raise all its tax revenue from a single tax on land. D. since land did not really belong to the landlords, rent was an unearned surplus.
The principal-agent problem as it applies to labor employment refers to:
A. Employer and workers wanting the firm to survive and thrive B. Firms having the profit motive, while workers may be shirking on the job C. Employers having a problem finding qualified workers D. Workers facing a problem finding employment