Short-Run Output ________ in the Last Quarter of 2008 and ________

question 2

Multiple Choice

Short-run output ________ in the last quarter of 2008 and ________ by the middle of 2009.

• A) growth was flat; recovered to a modest 1.2 percent
• B) was positive; fell to -3 percent
• C) turned negative; bottomed out at below -7 percent
• D) equaled zero; fell to -2 percent
• E) was rising; unemployment was 8 percent

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Definitions:

Perfect Price Discrimination

A pricing strategy where a seller charges each buyer their maximum willingness to pay, extracting all the consumer surplus.

Consumer Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service versus the total amount that they actually do pay.

Third-Degree Price Discrimination

Practice of dividing consumers into two or more groups.

Price Elasticities

Measures of how the quantity demanded or supplied of a good responds to a change in its price.