Other things constant, an increase in resource prices will
a. increase the demand for goods and services.
b. increase the cost of producing goods and services, which will lead to a higher price level.
c. reduce costs and improve profit margins, which will lead to an increase in aggregate supply in the goods and services market.
d. cause the natural rate of unemployment to rise.
B
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Refer to Figure 9.7. Because of this policy, total producer surplus including funds received from the government will be at least
A) $10,000. B) $40,000. C) $80,000. D) $100,000. E) $160,000.
In a perfectly competitive industry, which of the following is true?
a. The competitive price is higher and quantity higher than the socially efficient point. b. The competitive price is higher and quantity lower than the socially efficient point. c. Since the industry is perfectly competitive, price and quantity are at the socially efficient levels. d. The competitive price is lower and quantity higher than the socially efficient point.