Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward
B. Short-run aggregate supply shifting upward
C. Short-run aggregate supply shifting downward
D. Aggregate demand shifting leftward
Answer: B
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According to the total revenue test, a price cut increases total revenue if demand is
A) inelastic. B) perfectly inelastic. C) elastic. D) unit elastic.
A study of New York City (NYC) tax rates concluded that taxes on the nonmanufacturing sector should be higher since that sector has fewer alternatives. Manufacturers are more mobile and may move to avoid higher taxes. This means that
a. nonmanufacturing firms have a more elastic demand for NYC locations. b. manufacturing firms have an inelastic demand for the NYC locations. c. nonmanufacturing firms have relatively inelastic demand for the NYC locations. d. nonmanufacturing demand for NYC locations is perfectly elastic.