According to the aggregate demand-aggregate supply model, what is the short-run impact of a reduction in the money supply by the Fed?
A) Current output will fall, but the price level will rise.
B) Current output will rise, but the price level will fall.
C) Current output and the price level will both rise.
D) Current output and the price level will both fall.
D
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All of the following are government capital except
A) roads. B) schools. C) Treasury securities. D) mass-transit systems.
Assuming that the demand and supply of a good have moved in opposite directions, but by the same amount, the new equilibrium would represent: a. an increase in price and an increase in quantity exchanged
b. no change in price and an increase in quantity exchanged. c. a decrease in price and a decrease in quantity exchanged. d. an indeterminate change in price, but no change in quantity exchanged.
Assume a toy company hires an additional worker to assemble toys, and the size of the factory and amount of equipment remain constant. As a result, the level of output increases but by a smaller amount than when the previous additional worker was hired. This is an example of:
a) The law of substitution. b) Say's Law. c) The law of diminishing returns. d) The law of poor planning.
Which of the following is not held constant when considering the demand for pizza?
A. Expectations of higher prices for pizzas. B. Consumer incomes. C. The price of spaghetti (a substitute). D. The price of pizza.