Refer to Figure 16.1. An increase in the corporate tax rate is best represented by a movement from
A) point A to point B.
B) point B to point A.
C) point A to point C.
D) point C to point A.
C
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If the long-run supply of rice is perfectly elastic, then
A) as people's incomes rise, the quantity of rice supplied decreases. B) as the price of corn falls, the quantity of rice demanded decreases. C) in the long run, a large rise in the price of rice causes no change in the quantity of rice supplied. D) in the long run, an increase in the demand for rice leaves the price of rice unchanged.
One of the assumptions underlying the production possibilities curve is that
A) at least one of the factors of production is a free good. B) the quantity of the resources available for the production of economic goods is fixed over a given time period. C) there is at least one factor of production that is employed inefficiently. D) some of the factors of production are not being used.