New classical economists say that an unanticipated decrease in aggregate demand first:
A. decreases the price level and real output, and then decreases long-run aggregate supply.
B. decreases long-run aggregate supply, and then decreases the price level and real output.
C. reduces short-run aggregate supply, and then reduces long-run aggregate supply.
D. decreases the price level and real output, and then increases short-run aggregate supply
such that the economy returns to the full-employment level of output.
D. decreases the price level and real output, and then increases short-run aggregate supply
such that the economy returns to the full-employment level of output.
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Given the demand curve in Figure 5-24, explain how consumer’s surplus is calculated.
What will be an ideal response?
Refer to Figure 4-1. If the market price is $1.50, what is the consumer surplus on the first burrito?
A) $0.50 B) $1.00 C) $1.50 D) $7.50
The time and money it takes to organize a group or a campaign and to get the attention of lots of busy people is the:
A. cost of collective action. B. reason why collective action does not happen in the real world. C. reason why all individuals never participate in any collective action. D. initial set-up costs of the campaign or group.
If all countries specialize in producing goods for which they have a comparative advantage, then total world output will be lower
Indicate whether the statement is true or false