What would a central bank need to do to reverse the effects of a favorable supply shock on inflation? What would its reaction do to the unemployment rate in the short run?
It would increase the money supply growth rate. The unemployment rate would fall further below its natural rate.
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In the above figure, if the market quantity is restricted to 500,000 and the price is allowed to rise to set the quantity demanded equal to the quantity supplied, then the producer surplus is equal to
A) area D + area F. B) area C + area E. C) area A + area B + area C. D) area A + area B. E) area B + area D + area F.
Which of the following statements is generally true?
A) Rivalry is less the larger the number of firms in an industry. B) The smaller the number of firms in an industry, the greater the rivalry. C) The degree of rivalry in an industry is largely independent of the number of firms. D) The larger the number of firms in an industry, the greater the rivalry.