Based on the figure below. Starting from long-run equilibrium at point C, a tax increase that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at point ________ and eventually to a long-run equilibrium at point ________, if left to self-correcting tendencies.

Which of the following examples best describes the concept of free entry?

A) Jack has an old cell phone that he wants to sell. He opens an account on eBay and auctions it off. B) Purecircuit Cor

A bank faced with the wholesale loss of deposits is likely to shut down despite fundamentally sound balance sheet. Why could this be?

A) Banks have accountants that are too optimistic. B) Banks purposely lie about their balance sheets in order to attract more clients. C) Many bank assets are illiquid and cannot be sold quickly to meet deposit obligations without substantial loss to the bank. D) Many banks operate on a budget that exceeds their actual reserves. E) Many banks will shut down to preserve their interest profits.