If Government Spending Rises More Than Anticipated, Then Equilibrium Output

question 69

Multiple Choice

If government spending rises more than anticipated, then equilibrium output should _____ and the equilibrium price level should _____ in the short run.

• A) rise, rise
• B) rise, fall
• C) fall, rise
• D) fall, fall

Understand the concepts of marginal revenue and how it relates to monopolist's pricing and output decisions.

Recognize the barriers to entry created by monopolies and their implications for competition.

Identify the relationship between monopoly equilibrium, economic efficiency, and social welfare.

Explore the conditions under which monopolies may earn zero economic profits in the long-run equilibrium.

---

Definitions:

Psychosocial Reasons

factors related to individual psychological development in, and interaction with, a social environment.

Micro-aggressions

Subtle, often unintentional, forms of prejudice or discrimination against members of a marginalized group.

Hostile

Showing or feeling opposition or dislike; aggressive.

Grandchildren

The children of one's son or daughter, representing the next generation in a family lineage.