Which of the following statements about a firm's short-run variable costs is correct?
A. They are always a greater expense than are fixed costs.
B. They include the costs of plant and equipment.
C. They increase as the level of output decreases.
D. They typically include the cost of workers' wages.
Answer: D
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If investment in an economy falls, which of the following is likely to happen?
A) Labor demand will increase. B) The revenue of firms in the economy will fall. C) Asset prices will rise. D) The number of mortgage defaults will fall.
Preferences can be described as
A) what a person likes and dislikes. B) the income opportunities of several activities. C) feasible consumption combinations. D) the relative prices of goods and services.
In order for the banking system to expand the money supply with a money multiplier effect, all of the money loaned out
a. has to have been demand deposits at some bank b. has to stay in one bank c. by one bank has to be deposited in the same bank d. has to be repaid before the multiplier process can work e. has to equal the amount of legal reserves for the banking system
Using Figure 1 above, if the aggregate demand curve shifts from AD1 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y2. C. P3 and Y1. D. P2 and Y3.