Consider a monopolistic competitor who earns high profits in the short run. Which of the following changes will be observed in the demand curve faced by this firm in the long run?
a. The demand curve will become vertical.
b. The demand curve will become steeper.
c. The demand curve will become flatter.
d. The demand curve will slope upward.
b
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Barriers to immigration are much higher in most countries today, than it was in the twentieth century
a. True b. False Indicate whether the statement is true or false
The economy is in the horizontal portion of the AS curve, investment spending is interest insensitive and there is no liquidity trap. According to the Keynesian transmission mechanism, if the money supply increases the interest rate will __________, investment spending will __________, the AD curve will __________, and Real GDP will __________
A) fall; fall; left; fall B) rise; drop; left; fall C) fall; remain unchanged; not shift; not change D) rise; remain unchanged; not shift; not change E) none of the above