Starting from long-run equilibrium, an increase in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential
B. higher; higher
C. lower; higher
D. higher; potential
Answer: D
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The economic resource that organizes the use of other economic resources is called
A) labor. B) capital. C) entrepreneurship. D) land.
If there are four goods in a barter economy, then one needs to know ________ prices in order to exchange one good for another
A) 8 B) 6 C) 5 D) 4
Can macroeconomic policy be used systematically to create unanticipated inflation?
A) No, according to Keynesian economists. B) Yes, according to classical economists. C) No, according to classical economists. D) Yes, according to Keynesian economists, if Ricardian equivalence holds.
Government stabilization policy would be unnecessary if the economy automatically gravitated toward
a. full inflation. b. full employment. c. full recession. d. an inflationary gap.