A large increase in oil prices is an example of:
A. excessive aggregate spending.
B. inflation inertia.
C. a favorable inflation shock.
D. an adverse inflation shock.
Answer: D
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When a country abandons a no-trade policy, adopts a free-trade policy, and becomes an importer of a particular good,
a. producer surplus increases and total surplus increases in the market for that good. b. producer surplus increases and total surplus decreases in the market for that good. c. producer surplus decreases and total surplus increases in the market for that good. d. producer surplus decreases and total surplus decreases in the market for that good.
Which statement is true?
A. Productivity is input per unit of output. B. The MRP curve for the perfect competitor is steeper than the MRP curve for the imperfect competitor. C. The firm will hire workers until the wage rate and the Marginal Physical Product (MPP) of the last worker hired are equal. D. Relative to the U.S. economy, the Chinese economy is more labor intensive and less capital intensive.