If the SRAS curve intersects the AD curve to the left of Natural Real GDP, the economy is
A) in a recessionary gap.
B) at Natural Real GDP.
C) in an inflationary gap.
D) at full-employment Real GDP.
A
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Dina is driving to work on an interstate highway at 90 MPH, well in excess of the legal speed of 65 MPH. Sandy is also driving to work at the same time, going 85 MPH. A state trooper pulls Dina over and gives her a speeding ticket. Sandy continues driving, but if Dina had not been speeding, the trooper would have ticketed Sandy instead. In terms of externalities, this story shows that:
a. Sandy's actions gave Dina a positive externality. b. Dina's actions gave Sandy a positive externality. c. Sandy's actions gave Dina a negative externality. d. Dina's actions gave Sandy a negative externality. e. Dina's and Sandy's actions did not create any externalities.
It has been found that
a. less-developed countries have more equality of income distribution. b. more-developed countries have more equality of income distribution. c. only prior communist countries have more equality of income distribution. d. income distribution cannot be measured among countries with different political and economic systems.
The aggregate demand and aggregate supply model implies monetary neutrality
a. only in the short run. b. only in the long run. c. in both the short run and the long run. d. in neither the short run nor long run.
A decrease in government spending and taxes would be an example of fiscal policies that reinforce each other.
Answer the following statement true (T) or false (F)