Adam Smith describes a visit to a car factory when discussing economies of scale in his book An Inquiry into the Nature and Causes of the Wealth of Nations

Those who favor passive policy making do so because they conclude that

A) price and wage flexibility is a common and speedy occurrence. B) there is a stable trade-off between inflation and unemployment in the short run. C) price and wage flexibility is an uncommon occurrence. D) pure competition is not typical in most markets.

If macaroni and cheese is an inferior good, then a decrease in income results in

A) an increase in the demand for macaroni and cheese. B) a decrease in the demand for macaroni and cheese. C) an increase in the supply of macaroni and cheese. D) a decrease in the supply of macaroni and cheese. E) Both answers A and D are correct.