The total willingness to pay for a given number of units of a good or service is determined by multiplying the equilibrium price of the good by the number of units purchased

Suppose you were a forecaster of the real wage rate, employment, output, the real interest rate, consumption, investment, and the price level. A shock hits the economy, which you think is a temporary adverse supply shock

(a) What are your forecasts for each of the variables listed above (rise, fall, and no change)? (b) What if the shock was really due to people's reduced expectations about their future income. Which variables did you forecast correctly, and which did you forecast incorrectly?

An important similarity between a monopolistically competitive firm and a purely competitive firm is that:

A. both face perfectly elastic demand schedules. B. economic profit tends toward zero for both. C. both realize productive efficiency. D. both realize allocative efficiency.