A graphical representation which shows the trade-off that occurs when more of one output is obtained at the expense of another is called
A) a scarcity curve.
B) a production possibilities curve.
C) a growth curve.
D) a supply curve.
Answer: B
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The basic aggregate demand and aggregate supply curve model helps explain
A) price fluctuations in an individual market. B) short-term fluctuations in real GDP and the price level. C) long-term growth. D) output fluctuations in an individual market.
From the Monetarist perspective, the aggregate supply curve is
A) vertical. B) horizontal. C) sensitive to changes in the money supply. D) sensitive to changes in consumption.
During the Great Depression, one reason the Federal Reserve did not respond forcefully was the "free gold problem," which refers to the idea that ___
a. gold was fleeing Nazi Germany, thus undermining the Fed's attempt to control the money supply b. gold was essentially free because people had excess supplies of currency that could be converted into gold c. the Fed claimed that almost all its gold was tied up by reserve requirements (there was little free so it could not increase the money supply) d. gold was essentially free because silver, which existed in abundance, could be converted into gold at the fixed rate of 16:1
The supply curve displays the wishes of _____________.
Fill in the blank(s) with the appropriate word(s).