When real GDP exceeds aggregate planned expenditure
A) an unplanned increase in inventories occurs.
B) real GDP remains at its equilibrium.
C) real GDP increases.
D) firms increase production.
E) an unplanned decrease in inventories occurs.
A
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A monopolistically competitive market is described as one in which there are
A) a large number of firms selling similar, but not identical, products. B) one large firm and many small firms producing identical products. C) a few firms producing an identical product. D) a few firms producing differentiated products.
Which of the following is correct?
a. An increase in the money supply causes the interest rate to decrease so that aggregate demand shifts left. b. An increase in stock prices reduces consumption spending so that aggregate demand shifts left. c. An increase in the price level causes the exchange rate to rise so that aggregate demand shifts left. d. A recession in other countries reduces U.S. net exports so that U.S. aggregate demand shifts left.
Which costs of inflation could the government reduce without reducing inflation?
a. shoeleather and menu costs b. menu costs and relative price variability c. unintended changes in tax liabilities and arbitrary redistributions of wealth d. none of the above is correct.
Which of the following statements is most correct?
A. If the U.S. $ is depreciating relative to the euro it is likely depreciating relative to all currencies. B. If the U.S. $ is appreciating relative to the euro, the euro is likely depreciating relative to the yen. C. If the U.S. $ depreciates relative to the yen, then it is likely also depreciating relative to the euro. D. If the U.S. $ is appreciating relative to the yen, the yen is depreciating relative to the U.S. $.