When the price level increases people:
A. demand a smaller quantity of goods and services in the aggregate.
B. feel more wealthy.
C. have the same real value of assets, regardless of the change in the price level.
D. want to spend more, but can’t due to the prices of all goods and services going up.
A. demand a smaller quantity of goods and services in the aggregate.
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Based on the figure below. Starting from long-run equilibrium at point C, a tax increase that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at point ________ and eventually to a long-run equilibrium at point ________, if left to self-correcting tendencies.
A. D; C B. D; B C. A; B D. B; C
The natural rate of unemployment worsens if:
a. Labor force mobility worsens. b. Capital markets become more competitive. c. A nation's resource endowments expand. d. Real wages become more flexible. e. None of the above.
Shares of ownership in a corporation are known as
A. Corporate stock. B. Corporate bonds. C. Savings bonds. D. Retained earnings.
The key determinant of the standard of living in a country is
a. the amount of goods and services produced from each hour of a worker's time. b. the total amount of goods and services produced within the country. c. the total amount of its physical capital. d. its growth rate of real GDP.