The above figure shows the domestic market for wheat. Suppose this market is isolated from global competition. The with no government intervention, the equilibrium price is ________ and the equilibrium quantity is ________
A) $15 per ton; 100 million tons
B) $14 per ton; 250 million tons
C) $12 per ton; 300 million tons
D) $12 per ton; 250 million tons
E) $15 per ton; 400 million tons
D
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If the United Auto Workers union can obtain a substantial wage increase for auto workers, there will be
a. a decrease in the supply of automobiles, which is a shift to the right of the supply curve. b. a decrease in the supply of automobiles, which is a shift to the left of the supply curve. c. an increase in the supply of automobiles, which is a shift to the right of the supply curve. d. an increase in the supply of automobiles, which is a shift to the left of the supply curve.
Use the dynamic aggregate demand and aggregate supply model and start with Year 1 in long-run macroeconomic equilibrium. For Year 2, graph aggregate demand, long-run aggregate supply, and short-run aggregate supply such that the condition of the economy
will induce the Federal Reserve to conduct a contractionary monetary policy. Briefly explain the condition of the economy and what the Federal Reserve is attempting to do. What will be an ideal response?