The recessions of the 1970s are often attributed to an increase in oil prices.
Answer the following statement true (T) or false (F)
True
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After a temporary adverse supply shock hits the economy, general equilibrium is restored by
A. a shift up and to the left of the LM curve. B. a shift to the left of the FE line. C. a shift down and to the left of the IS curve. D. a shift down and to the right of the IS curve.
Which among the following is an example of "economizing" behavior?
A) A ski resort owner who is deciding whether or not to remain in operation during a season with abnormally low snowfall B) The board of directors of a major bank who are considering opening new branches in a neighboring state C) The planning committee of a conservative church parish, which is considering the reintroduction of the Post-Tridentine, Latin-language mass D) A family comparing the costs of a vacation in the mountains to the cost of a vacation at the beach E) All of the above.
Refer to Figure 3-7. Assume that the graphs in this figure represent the demand and supply curves for frozen yogurt. Which panel describes what happens in the market for frozen yogurt when the price of ice cream, a substitute product, increases?
A) Panel (a) B) Panel (b) C) Panel (c) D) Panel (d)
Decreases in government spending
a. shift the aggregate supply to the right. b. have no effect on aggregate demand. c. shift the aggregate demand curve to the right. d. shift the aggregate demand curve to the left.