The aggregate supply-aggregate demand model predicts that an unexpected increase in government spending will have what short-run effects?
What will be an ideal response?
An increase in both the price level and real output.
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Under the current managed float exchange rate regime; countries with surpluses in their balance of payments frequently do not want to see their currencies appreciate because it makes their goods ________ expensive abroad and foreign goods ________ in
their countries. A) more; cheaper B) more; costlier C) less; cheaper D) less; costlier
Economic theory assumes that the goal of firms is to maximize
a. sales b. total revenue c. profit d. price e. utility
One reason why purchasing power parity may not work perfectly has to do with barriers to trade such as tariffs and quotas on imports
a. True b. False
One major barrier to entry under pure monopoly arises from:
A. diseconomies of scale. B. the availability of close substitutes for a product. C. the price taking ability of the firm. D. ownership of essential resources.