What is an economy?
What will be an ideal response?
An economy is a type of organization that produces goods and services and then allocates those goods and services to its members.
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In the mid-1970s, Newsweek magazine reported that the city of Atlanta lowered its city bus fares from 40 cents to 15 cents a passenger. The number of bus riders increased by 15 percent after the fare cut
This set of results indicates that the demand for bus rides in Atlanta at that time was A) unit elastic. B) perfectly inelastic. C) elastic. D) inelastic. E) perfectly elastic.
The short-run supply curve of a perfectly competitive industry with firms having identical costs is:
a. a horizontal line at the market price. b. a vertical line at the equilibrium output. c. an upward rising curve. d. a downward sloping step function.
If output increases, which of the following would occur?
a. Prices of non-labor inputs, input requirements per unit of output, and unit costs would all increase, and the economy would move downward along the aggregate supply curve. b. Prices of non-labor inputs, input requirements per unit of output, and unit costs would all decrease, and the economy would move downward along the aggregate supply curve. c. Prices of non-labor inputs, input requirements per unit of output, and unit costs would all decrease, and the economy would move upward along the aggregate supply curve. d. Prices of non-labor inputs, input requirements per unit of output, and unit costs would all increase, and the economy would move upward along the aggregate supply curve. e. Prices of non-labor inputs and input requirements per unit of output would increase, unit costs would decrease, and the economy would move downward along the aggregate supply curve.
If Claeys, a candy-making firm that specializes in old-fashioned hard candies, chooses not to produce at a production level where its MR = MC, then it
a. is making as much profit as possible b. will incur losses c. cannot be earning a profit d. should really shut down before it loses everything e. is not earning maximum profit