Figure 10-18
Beginning from a point of short-run equilibrium at point E2 in , the economy's movement to a new position of long-run equilibrium from that point would best be described as
a.
a movement along the AD2 curve with a shift in the SRAS1 curve to SRAS2.
b.
a movement along the SRAS2 curve with a shift in the AD2 curve.
c.
a shift in the LRAS curve to an intersection at E3.
d.
no shift of any kind.
a
You might also like to view...
Suppose the Fed wants to fix the U.S. dollar/Mexican peso rate at 11 pesos per dollar under a fixed exchange rate policy. If the exchange rate falls to 10 pesos per dollar, the Fed can
A) buy dollars. B) sell dollars. C) attempt to freeze all sales of dollars. D) any of the above actions could take place.
Name the eight HPAEs
What will be an ideal response?
In the Keynesian model, if planned saving is greater than planned investment,
a. the economy will expand. b. unemployment will rise. c. the marginal propensity to consume will decline. d. the rate of interest will rise.
An unmarried couple holding joint title to their condominium constitutes a household
a. True b. False Indicate whether the statement is true or false