The aggregate demand curve is downward sloping because
a. an increase in the price level will cause an increase in spending on goods and services.
b. at lower price levels, real wealth decreases, causing a decrease in the quantity demanded of goods and services.
c. at lower price levels, interest rates increase, causing a decrease in the quantity demanded of goods and services.
d. at lower price levels, net exports increase, causing an increase in quantity demanded of goods and services.
D
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According to adaptive expectations theory, expansionary monetary and fiscal policies to reduce the unemployment rate are
A) useless in the short run
B) useless in the long run
C) ineffective on the price level
D) none of the above
The relationship between urbanization and GDP per capita, it is likely to be represented by a(n):
A) downward-sloping curve. B) inverted U-shaped curve. C) U-shaped curve. D) upward-sloping curve.
A crawling peg is an exchange rate arrangement in which the rate is adjusted in small amounts at fixed, preannounced rates
Indicate whether the statement is true or false
Which of the following statements are false?
A. If the CPI has gone up since the base year, inflation has occurred. B. Inflation generally occurs before wars. C. A period of great price stability since World War II was 1958 to 1964. D. Inflationary recessions first occurred in the 1970s.