Which of the following is likely to happen if there is an increase in entrepreneurial activity in an economy?
A) The productivity of the economy will increase.
B) The inflation rate in the economy will decrease.
C) The exchange value of its currency in the foreign exchange market will increase.
D) The income per capita of the economy will fall.
A
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The above figure shows a monopolistically competitive firm. The figure
A) is only a short-run illustration because the firm is making an economic profit. B) could be either a short-run or long-run illustration because monopolistically competitive firms can make an economic profit in the long-run. C) is only a long-run illustration because the firm is making zero economic profit. D) is neither a short- nor a long-run illustration.
Which of the following supply shocks will shift the long-run aggregate supply curve outward?
a. An increase in business taxes b. An increase in gasoline taxes c. An increase in the cost of raw materials d. An increase in the amount and cost of government regulation e. An increase in agricultural output