What determines the level of output in the long-run classical model?
A. aggregate demand
B. capital, labor, productivity
C. interest rates
D. prices
Ans: B. capital, labor, productivity
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Suppose the U.S. GDP growth rate is slower relative to other countries' GDP growth rates. This will
A) shift the aggregate demand curve to the left. B) move the economy down along a stationary aggregate demand curve. C) shift the aggregate demand curve to the right. D) move the economy up along a stationary aggregate demand curve.
Suppose there is an unusually large crop of apples this year. How might this affect the market for apples?
A. The demand would increase, increasing both equilibrium price and quantity. B. The supply would increase, decreasing equilibrium price and increasing equilibrium quantity. C. The demand would decrease, decreasing both equilibrium price and quantity. D. The supply would decrease, increasing equilibrium price and decreasing equilibrium quantity.
Which is NOT a function of money?
The idea in economics that "there is no free lunch" means that:
A. Businesses would go bankrupt if they offered free lunches B. The thought of a free lunch is often better than the reality of consuming it C. There are opportunity costs involved even in free lunches D. Free lunches used by businesses to attract customers is an inefficient marketing ploy