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Starting from Potential Output, If Consumer Confidence Increases and Consumers

question 86

Multiple Choice

Starting from potential output, if consumer confidence increases and consumers decide to spend more, then this will shift the ______ curve to the right and generate ______.


Definitions:

Monopsonist

A monopsonist is a market condition where there is only one buyer in a market, giving this buyer significant control over the price and terms of purchase.

Labor Supply

The total hours that workers are willing and able to work at a given wage rate, across an economy or market.

Marginal Revenue Product

The additional revenue a firm earns by employing one more unit of input, such as labor or capital.

Variable Input

An input in the production process that can be varied in the short term to adjust output, such as labor or raw materials.

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