The aggregate demand curve:
A. shows the price level on the horizontal axis and output on the vertical axis.
B. shows the relationship between the overall price level and the level of total demand.
C. shows the relationship between the price of goods and services and the level of total demand.
D. is upward-sloping, which is counter to the individual demand curve.
Answer: B
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An average tax rate is calculated as
A) total taxable income × taxes paid. B) taxes paid ÷ total taxable income. C) (total taxable income - taxes paid) ÷ taxable income. D) total taxable income ÷ taxes paid.
A firm's horizontal dimension refers to
A) its size in its primary market. B) its size in all markets in which is competes. C) the level of supply chain integration the firm undertakes. D) the number of stages in the production process that are upstream from the stages the firm undertakes.
If the demand for hand-sewn leather shoes increases, it is likely the demand for leather will:
A. also increase. B. decrease slightly. C. stay the same. D. drop significantly and producers will use another material.
For this question, assume that exchange rates flexible and that the exchange rate expected to occur in one year is not constant. Suppose that individuals now expect that the domestic central bank will pursue expansionary monetary policy in one year. This expected future monetary expansion will cause which of the following to occur?
A) The current nominal exchange rate will decrease. B) The current nominal exchange rate will increase. C) The current nominal exchange rate will not change. D) The effects on the current nominal exchange rate are ambiguous.