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 93 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?

Calcitonin is a naturally occurring hormone. In women who are at least 5 years beyond menopause, it slows bone loss and increases spinal bone density.

Did you know?

Every 10 seconds, a person in the United States goes to the emergency room complaining of head pain. About 1.2 million visits are for acute migraine attacks.

Did you know?

Pink eye is a term that refers to conjunctivitis, which is inflammation of the thin, clear membrane (conjunctiva) over the white part of the eye (sclera). It may be triggered by a virus, bacteria, or foreign body in the eye. Antibiotic eye drops alleviate bacterial conjunctivitis, and antihistamine allergy pills or eye drops help control allergic conjunctivitis symptoms.

Did you know?

Medications that are definitely not safe to take when breastfeeding include radioactive drugs, antimetabolites, some cancer (chemotherapy) agents, bromocriptine, ergotamine, methotrexate, and cyclosporine.

Did you know?

By definition, when a medication is administered intravenously, its bioavailability is 100%.

For a complete list of videos, visit our video library