A federal policy that leads to an increase in aggregate supply is likely to result in:
a. lower levels of employment
b. an increase in aggregate demand.
c. a higher price level.
d. lower levels of real GDP.
e. an economic expansion.
e
You might also like to view...
In the above figure, at which point on the demand curve is the price elasticity of demand equal to 1?
A) a B) b C) c D) It is impossible to say at which point the elasticity equals one.
Why does government provide educational opportunities in the form of vouchers, subsidies, and public provision?
What will be an ideal response?
When the absolute price elasticity of demand is less than 1, demand is
A) elastic. B) unit-elastic. C) inelastic. D) undetermined without more information.
The market for Product A is at equilibrium at a price of €35. How will the market be affected if the government introduces a ceiling price which is €15 below the equilibrium price?
a) The ceiling price will have no effect on the market. b) The new price for product A will be €20 and there will be excess demand at this price. c) The new price for product A will be €50 and there will be excess supply at this price. d) The market mechanism will ensure that the market returns to equilibrium.