Using the AD-AS model, if consumers and business become more optimistic about the future direction of the economy and increase spending, then:
a. aggregate demand will decrease.
b. aggregate demand will increase.
c. long-run aggregate supply will increase.
d. long-run aggregate supply will decrease.
b
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Which of the following best describes a flow rather than a stock? a. You own $5,000 worth of government bonds. b. You own a $100,000 house
c. You own a coin collection valued at $10,000. d. You earn $500 per week. e. You own a $45,000 automobile.
An exchange rate is the number of units of:
a. a nation's money that is equal to one unit of another nation's money. b. a nation's output that is equal to one unit of another nation's output. c. gold backing a nation's money. d. none of these.
A price index is the
A. cost of a market basket of goods today. B. cost of a market basket of goods and services today expressed as a percentage of the cost of the same market basket during a base year. C. year that is chosen as the point of reference for comparison of prices in other years. D. cost of a market basket of goods and services a year ago expressed as a percentage of the cost of the same market basket today.
Refer to the information provided in Figure 2.6 below to answer the question(s) that follow.
Figure 2.6Refer to Figure 2.6. If the economy is at ppf2, a change in consumer taste would be shown by a
A. movement along ppf2. B. movement along ppf1. C. shift from ppf2 to ppf1. D. shift from ppf1 to ppf2.