What factors explain the extended period of economic growth 1992-2000?
The prosperity was exceptional and surprising. High rates of economic growth, low rates of unemployment and inflation. The explanation involves factors that affected both aggregate demand and aggregate supply. The diffusion of computer technology in the 1990s served to increase labor productivity, shifting the aggregate supply curve to the right thereby lowering the price level and increasing real GDP. The stock market boom that accompanied the GDP growth resulted in people believing that had more real wealth and they reacted by shifting the aggregate demand curve to the right. This, as well, increased real GDP.
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Suppose that the price of capital falls. Does this necessarily imply that the demand for laborwill fall? Explain
What will be an ideal response?
The price elasticity of demand shows
A) the relationship between market price and household income. B) the proportionate amount by which the quantity demanded changes in response to a proportionate change in price. C) the quantity demanded at a given price. D) the proportionate amount by which the price changes in response to a proportionate change in quantity demanded.
In his book Losing Ground, _________ argued that between 1968 and 1980 government antipoverty spending quadrupled, but the poverty rate remained the same.
Fill in the blank(s) with the appropriate word(s).
If price is above the equilibrium price, then there will be:
A. excess supply. B. neither excess supply nor excess demand. C. excess demand. D. both excess supply and excess demand.