Given an aggregate supply curve, a decrease in aggregate demand will:
a. increase the real interest rate.
b. increase real GDP.
c. increase the price level.
d. decrease the real exchange rate.
e. decrease real GDP.
QUESTION 2A group of firms that collude to limit competition is called a(n):
a. conglomerate.
b. oligopoly.
c. cartel.
d. kinked demand.
e. market concentration.
QUESTION 3The total fixed cost curve:
a. varies with the quantity of inputs used.
b. decreases with output.
c. increases with output.
d. remains constant regardless of output.
QUESTION 4For a given aggregate supply curve, an increase in aggregate demand will:
a. decrease the real interest rate.
b. increase real GDP.
c. decrease the price level.
d. increase the real exchange rate.
e. decrease real GDP.
QUESTION 5Cartel members have an incentive to cheat on the cartel because:
a. the cartel does not maximize profits.
b. the cartel price is the competitive price.
c. each member's output quota is too high.
d. each member's MR is not equal to the cartel's MC.
e. the industry profit would be higher under competitive conditions.
QUESTION 6The total fixed cost remains constant as which of the following varies?
a. Cost of resources.
b. Time.
c. Output in a given period of time.
d. Profit.
QUESTION 7If the U.S. price level increases relative to price levels in foreign countries, _____.
a. the aggregate supply curve for the U.S. will shift outward and the aggregate demand curve would remain unchanged
b. the aggregate supply curve for the U.S. will shift inward and the aggregate demand curve would remain unchanged
c. the aggregate demand curve for the U.S. will shift outward and the aggregate supply curve would remain unchanged
d. the aggregate demand curve for the U.S. will shift inward and the aggregate supply curve would remain unchanged
e. both the aggregate demand and the aggregate supply curves for the U.S. will shift outward
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