The three main components of the aggregate demand-aggregate supply model include
A. SRAS, LRAS, IS.
B. AD, SRAS, LRAS.
C. AD, IS, LM.
D. AD, SRAS, LM.
Answer: B
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The amount of deadweight loss from a tax depends upon the
a. price elasticity of demand. b. price elasticity of supply. c. amount of the tax per unit. d. All of the above are correct.
A policymaker in favor of stabilizing the economy would be likely to believe
a. recessions are a waste of resources. b. economies must suffer through the booms and busts of the business cycle. c. the long policy lags make implementing policy changes in response to recession too risky. d. policy increases the magnitude of economic fluctuations.
This figure displays the choices being made by two coffee shops: Starbucks and Dunkin Donuts. Both companies are trying to decide whether or not to expand in an area. The area can handle only one of them expanding, and whoever expands will cause the other to lose some business. If they both expand, the market will be saturated, and neither company will do well. The payoffs are the additional profits (or losses) they will earn.According to the figure shown, Starbucks:
A. has first-mover advantage. B. should wait to see what Dunkin Donuts is going to do. C. has a dominant strategy not to expand. D. has a dominant strategy to expand.
Holding all other personal characteristics-such as age, gender, and income-constant, economists would expect that
A) people with health insurance are less likely to be overweight than people without health insurance. B) people with health insurance are more likely to be overweight than people without health insurance. C) people with health insurance are equally likely to be overweight as people without health insurance. D) there is no correlation between having health insurance and being overweight.