A Classical aggregate supply curve is
A) vertical.
B) upward-sloping.
C) horizontal.
D) downward-sloping.
A
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Expansionary fiscal policy falls short of its goal. Some economists claim it is due to indirect crowding out. What evidence would be consistent with this claim?
A) The interest rate increased. B) The price level decreased. C) Saving decreased. D) An increase in consumer spending occurred.
If the price of a good rises, supply will
A. increase. B. decrease. C. not change. D. the answer depends upon the demand in the market.
An increase in wealth would cause the IS curve to
A) shift up and to the right. B) shift down and to the left. C) remain unchanged. D) shift up and to the right only if people face borrowing constraints.
When demand is perfectly inelastic, an increase in price will
A) leave total revenue unchanged. B) increase total revenue. C) decrease total revenue. D) either increase total revenue or decrease total revenue, but it is impossible to tell which.