In the above figure, the aggregate demand curve is AD2, so the long-run equilibrium level of real GDP is
A) $16 trillion.
B) $16.5 trillion.
C) more than $16 and less than $16.5 trillion.
D) None of the above answers is correct.
A
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Which of the following is not appropriate, if we live in a world of fixed exchange rates?
A) monetary approach to the exchange rate B) elasticities approach C) monetary approach to the BOP D) absorption approach
As part of the "exchange rate effect of monetary policy," a lower money supply causes __________ of the domestic currency and thus __________ net exports
A) appreciation; rising B) appreciation; falling C) depreciation; rising D) depreciation; falling
Ceteris paribus, if negotiations lead to lower wages for airline employees, what will be the result in the market for air travel?
a. an increase in equilibrium price and an increase in equilibrium quantity b. an increase in equilibrium price and a decrease in equilibrium quantity c. a decrease in equilibrium price and an increase in equilibrium quantity d. a decrease in equilibrium price and a decrease in equilibrium quantity
According to economist Milton Friedman, a. the short-term validity of the Phillips curve is questionable
b. there might be a short-term trade-off between unemployment and inflation but not a permanent trade-off. c. trade-off happens between unemployment and inflation happens in the long run but not in the short run. d. the long-run trade-off between unemployment and inflation comes from unanticipated inflation.