Cost-push inflation might initially result from
A) the use of new technology.
B) a decrease in the quantity of money.
C) an increase in the cost of resources.
D) an increase in the quantity of money.
E) an increase in government expenditure.
C
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The open economy effect refers to the fact that
A) the position and shape of the long run aggregate supply curve is partially due to the fact that we import goods. B) the slope of the aggregate demand curve is partially explained by the reduction in the desire to buy fewer U.S. goods by U.S. residents and foreign residents as a result of a higher price level. C) the immigration policies of the United States are disruptive to labor markets. D) the aggregate supply curve shifts when the economy grows.
The above figure shows supply and demand curves for milk. If the government passes a $2 per gallon specific tax, the loss in producer surplus will equal
A) b + c + f + g. B) f + g. C) b + f. D) c + g.