Refer to Figure 2-9. What is the opportunity cost of producing 1 snow cone in Greenland?

In a market economy, the decision regarding allocation of resources is made by

a. automatic forces of supply and demand. b. authorities in Washington, D.C. c. planners in state capitals. d. committees from a variety of economic interest groups. e. All of the above are correct.

Refer to the diagram and assume the economy initially is in equilibrium at point a. In the mainstream view, a decline in aggregate demand from AD 1 to AD 2 would likely move the economy:

A.  directly from a to d.
B.  directly from a to b.
C.  from a to c, then quickly from c to d.
D.  from a to c, then eventually from c to b.