Short-run movements in inflation and output are ultimately attributed to changes in:
A. aggregate demand and aggregate supply.
B. foreign policy.
C. aggregate demand.
D. aggregate supply.
Answer: A
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Suppose that a tax is placed on books. If the buyers pay the majority of the tax, then we know that the
a. demand is more inelastic than the supply. b. supply is more inelastic than the demand. c. government has required that buyers remit the tax payments. d. government has required that sellers remit the tax payments.
Provide an intuitive explanation of the free-rider problem.
What will be an ideal response?
In the linear equation y = mx + b, an increase in b will:
A. shift the curve down. B. shift the curve up. C. cause the curve to become flatter. D. cause the curve to become steeper.
A one percentage point in the growth rate
A. can make a big difference in the per capita real GDP because of compounding. B. can make a big difference in the per capita real GDP because of urban congestion. C. does not make much difference in the long run per capita real GDP. D. will not influence the real standard of living in a country.