If a price ceiling is set above the equilibrium price, then
A) there will be a surplus of the good.
B) there will be a shortage of the good.
C) there will be neither a shortage nor a surplus of the good.
D) the price ceiling will generate revenue for the government.
E) the price ceiling affects suppliers but not demanders.
C
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If factor prices decrease:
a) a firm will move down along its long-run average cost curve only. b) a firm will move down along both its long-run and short-run average cost curves. c) both the long-run and short-run average cost curves will shift downward. d) there will be no change in the cost curves in the long run. e) there will be a downward shift in the long-run average cost curve but not in the short-run average cost curve.
If the shifts in AD that will result from policy changes are fully and accurately anticipated, an increase in government purchases or a decrease in taxes would result in which of the following in the short run?
a. a higher level of real output and a higher price level b. a higher level of real output but no change in the price level c. a higher price level and a reduced level of real output d. a higher price level but no change in real output