Which of the following is most likely to occur during recession?
a. Increase in wage rate
b. Decrease in potential real GDP
c. Increase in the market rate of interest
d. Decrease in the average price level
e. Decrease in the government transfer payments
d
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What leads thousands of profit seeking entrepreneurs to misread the signals of the market-price system?
A) Poor budget policy on behalf of government officials B) The globalization of the world economy C) An artificial lowering of interest rates D) A poor knowledge of the basic principles of supply and demand
Restrictive monetary policy will:
A. Decrease the lending capacity for banks. B. Reduce interest rates. C. Cause a rightward shift of aggregate demand. D. Raise the equilibrium price level.
Compare 2000 with 2001. Which of the following statements is (are) true?
What will be an ideal response?
The long-run aggregate supply curve plays an important role in determining:
A. output in the long run. B. the price level in the short run. C. output in the short run and long run. D. output in the short run.