Refer to the graph below, which shows an aggregate demand. If the economy is at point C and the price level increases by 100, then the wealth, interest-rate, and foreign purchases effects will:
A. Move the economy to point A
B. Move the economy to point B
C. Move the economy to point D
D. Shift the AD curve to the left
A. Move the economy to point A
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What happens if the economy is at its long-run equilibrium and aggregate demand increases?
What will be an ideal response?
When there is an external cost, the unregulated market
A) overproduces the good or service. B) underproduces the good or service. C) reaches the most efficient solution. D) minimizes public welfare.
Which of the following is NOT true of an oligopoly?
A) They advertise their product. B) The firms recognize their interdependence. C) A few firm account for a large portion of the total output. D) Firms are price takers.
Checking accounts are included in
A) certificates of deposit. B) currency. C) lines of credit. D) M1.