A shock that increases the costs of production is a
A) positive aggregate demand shock.
B) positive aggregate supply shock.
C) negative aggregate demand shock.
D) negative aggregate supply shock.
D
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If a regulatory board wanted to make sure that a natural monopoly chose a price resulting in the efficient level of output, it should set a price equal to: a. marginal cost
b. average fixed cost. c. average variable cost. d. average total cost.
People may vote in a presidential election if
A) they feel it is their civic duty to vote. B) they believe their vote will matter. C) the costs of doing so are greater than the benefits received from voting. D) a or b E) a, b, or c
To an economist, "investment" in the GDP accounts means purchases of new final goods and services by firms.
Answer the following statement true (T) or false (F)
In the above figure, suppose the economy is at a short-run equilibrium at point B and the interest rate is r2. Which of the following policy options for the Fed will help solve the short-run situation?
A. open market sale of government securities B. open market purchase of government securities C. lowering the required reserve ratio D. lowering the differential between the discount rate and the federal funds rate