?Exhibit 10A-1 Aggregate demand and supply model
?Beginning in Exhibit 10A-1 from long-run equilibrium at point E1, the aggregate demand curve shifts to AD2 . The economy's path to a new long-run equilibrium is represented by a movement from:
A. ?E3 to E1 to E2.
B. ?E1 to E3 to E2.
C. ?E2 to E1 to E2.
D. ?E1 to E2 to E3.
Answer: D
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Using a production possibilities curve, a technological advance that increases the amount of output for the same amount of inputs would be illustrated as
a. an inward shift of the curve. b. a movement from one point to another point along the curve. c. an outward shift of the curve. d. a movement from a point on the curve to a point inside the curve.
If a county has 25 billion euros of imports, 15 billion euros of exports, and sells 20 billion euros of assets to foreigners, how many foreign assets do domestic residents purchase?
a. 5 billion euros b. 10 billion euros c. 30 billion euros d. None of the above are correct.
An example of a supply shifter is:
A) demographic characteristics. B) technology. C) income. D) consumer expectations.
Which of the following is TRUE of the price charged by a monopolistically competitive firm at the profit-maximizing level of output?
A. P > MC B. P < AVC C. P = MC D. P = MR