In its simplest form, Say’s law states that ______.
a. supply creates its own demand
b. prolonged unemployment is possible
c. full employment means zero unemployment
d. wages and other prices are inflexible
a. supply creates its own demand
Economics
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What is an example of a positive external shock to aggregate supply?
(A) China announces that it will import 50 percent more corn from the United States. (B) Demand for new suburban houses increases the value of farmland. (C) Good weather leads to an unusually productive harvest for corn farmers. (D) A popular new diet encourages consumers to buy more corn flakes.
Economics
Let the production function be q=ALaKb. The function exhibits increasing returns to scale if
A) a + b = 1. B) a + b > 1. C) a + b < 1. D) Cannot be determined with the information given.
Economics