Long-run full-employment equilibrium assumes:
a. a downward-sloping production function
b. a downward-sloping long-run supply curve (LRAS).
c. the CPI index price level equals the equilibrium wage rate.
d. the CPI equals aggregate demand (AD) equals short-run aggregate supply (SRAS) equalslong-run aggregate supply (LRAS).
d
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The above figure depicts the Edgeworth box for two individuals, Al and Bruce. If the endowment is at point a and trade is possible, which of the following points are possible equilibria?
A) a and b B) a and c C) b and d D) c and d
What is true about threats in the game in Scenario 13.15?
A) Simple can change the equilibrium by means of a credible threat; Boring cannot. B) Boring can change the equilibrium by means of a credible threat; Simple cannot. C) Boring can change the equilibrium by means of a credible threat only if it can move before Simple. D) Simple can change the equilibrium by means of a credible threat only if it can move before Boring. E) Neither firm has a credible threat with which to change this equilibrium.