Long-run market supply curves are downward sloping if
A) firms are identical.
B) the number of firms is restricted in the long run.
C) input prices fall as the industry expands.
D) All of the above.
C
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When comparing partial equilibrium effects to general equilibrium effects one can conclude that
A) general equilibrium effects are always larger. B) partial equilibrium effects are always larger. C) the effects are of equal size. D) one cannot determine before the fact which effect is greater.
(Consider This) The U.S. recession that occurred in 2008 and 2009 represented a case where:
A. government policy intervention effectively offset the negative demand shock and minimized the effects on output and employment. B. prices were somewhat flexible, so the impact of the demand shock was felt about the same in terms of price and output changes. C. prices were relatively flexible, minimizing the impact on total output and employment. D. prices were relatively sticky and most of the impact was on total output.