Author Question: Refer to Figure 16-6. In the dynamic model of AD-AS in the figure above, if the economy is at point ... (Read 94 times)

fbq8i

  • Hero Member
  • *****
  • Posts: 527
Refer to Figure 16-6. In the dynamic model of AD-AS in the figure above, if the economy is at point A in year 1 and is expected to go to point B in year 2, Congress and the president would most likely pursue
 
  A) contractionary fiscal policy.
  B) expansionary monetary policy.
  C) expansionary fiscal policy.
  D) expansionary automatic stabilizers.
  E) contractionary monetary policy.

Question 2

Your boss explains to you that the total fixed costs of the company are 1 million. He also informs you that each unit of production will cost twenty five cents more with each 100-unit increase.
 
  He has asked you to draw the fixed costs of the company with costs on the vertical axis and quantity of goods sold on the horizontal axis. Without drawing a graph tell your boss what the graph will look like using words. What information did your boss give you that you didn't need in order to draw the graph?



raenoj

  • Sr. Member
  • ****
  • Posts: 340
Answer to Question 1

A

Answer to Question 2

The fixed cost graph will be a horizontal line. The costs do not change with changes in output. The information that he gave me concerning how much additional units of production would cost is irrelevant since those are variable expenses and the boss was asking me to draw the fixed cost graph as a function of output.



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

Everyone has one nostril that is larger than the other.

Did you know?

There are more nerve cells in one human brain than there are stars in the Milky Way.

Did you know?

Since 1988, the CDC has reported a 99% reduction in bacterial meningitis caused by Haemophilus influenzae, due to the introduction of the vaccine against it.

Did you know?

It is believed that humans initially contracted crabs from gorillas about 3 million years ago from either sleeping in gorilla nests or eating the apes.

Did you know?

Giardia is one of the most common intestinal parasites worldwide, and infects up to 20% of the world population, mostly in poorer countries with inadequate sanitation. Infections are most common in children, though chronic Giardia is more common in adults.

For a complete list of videos, visit our video library