Assuming a long-run aggregate supply curve, a decrease in government spending results in ________ in output and ________ in price level
A) no change; a decrease B) an increase; no change
C) no change; an increase D) a decrease; a decrease
A
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The combination of producer and consumer surplus shows the:
a. maximum price that buyers are willing to pay for a good b. minimum price buyers are willing to pay for a good c. maximum price that sellers can charge. d. minimum price below which sellers will not sell. e. gains from voluntary exchange.
Foreign exchange rate stability is important because a decline in the value of the domestic currency will ________ the inflation rate, and an increase in the value of the domestic currency makes domestic industries ________ competitive with competing foreign industries.
A) increase; more B) increase; less C) decrease; more D) decrease; less
Suppose a consumer spends her income on two goods: music CDs and DVDs. The price of a CD is $8, and the price of a DVD is $20 . If we graph the budget constraint by measuring the quantity of CDs purchased on the vertical axis and the quantity of DVDs on the horizontal axis, what is the slope of the budget constraint?
a. -5.0 b. -2.5 c. -0.4 d. The slope of the budget constraint cannot be determined without knowing the income the consumer has available to spend on the two goods.
According to the crude quantity theory of money, if M rises by 8%, Q will
A. fall by 8%. B. fall by less than 8%. C. stay the same. D. Rise by less than 4%.