Z is a normal good. The equilibrium price and quantity of Z in the year 2011 was $25 and 60 units, respectively. In 2014, the equilibrium price of Z had increased to $35 and the equilibrium quantity had increased to 70 units
Other things remaining the same, which of the following could explain this change? A) Shift of the supply curve of Z to the left
B) Shift of the supply curve of Z to the right
C) Shift of the demand curve for Z to the left
D) Shift of the demand curve for Z to the right
D
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting downward C. Aggregate demand shifting rightward D. Aggregate demand shifting leftward
What is meant by crowding out? Explain the difference between crowding out in the short run and in the long run
What will be an ideal response?
Which of the following statements about marginal utility is correct?
a. When marginal utility is negative, an increase in the quantity will increase total utility. b. When marginal utility is decreasing, an increase in quantity will decrease total utility. c. When marginal utility is positive, an increase in quantity will decrease total utility. d. When marginal utility is zero, an increase in quantity will leave total utility unchanged. e. When total utility is increasing, marginal utility will be negative.
All of the following except one are reasons the demand deposit multiplier may be smaller in practice than in theory. Which one is not a valid reason?
a. Banks do not want to hold excess reserves. b. Some of the currency generated when bonds are purchased ends up outside of the banking system. c. Banks sometimes hold more than their required reserves. d. An open market operation may change the public's holding of cash. e. All of the above are not valid reasons.