An economy in which output has decreased and prices have decreased would suggest a:
A. decrease in short-run aggregate supply.
B. increase in aggregate demand.
C. increase in short-run aggregate supply.
D. decrease in aggregate demand.
Answer: D
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According to Pigovian analysis, when is a tax necessary to improve the market's economic efficiency?
a. When high transactions costs prevent private bargaining. b. When the social marginal cost of production exceeds the private marginal cost. c. When consumption of the good creates external benefits for others. d. When at the competitive equilibrium, the social marginal benefit of the good equals its social marginal cost.
The marginal social benefit (MSB) of abatement represents
a. the additional gains to society from reducing pollution b. the reduction in damages from abatement c. society's demand for abatement or environmental quality d. all of the above
The above table shows the tons of steel and concrete that can be produced by the United States and France in an hour. From the data in the table
A) France has a comparative advantage in the production of concrete. B) the United States has a comparative advantage in the production of concrete. C) France has an absolute advantage in the production of concrete. D) the United States has a comparative advantage in the production of both goods.
A product is considered to be rival if
A) your consumption of the product reduces the quantity available for others to consume. B) you can keep those who did not pay for the item from enjoying its benefits. C) you cannot keep those who did not pay for the item from enjoying its benefits. D) it is jointly owned by all members of a community.