An increase in aggregate demand is most likely to cause an increase in the price level when the economy is
A. operating near full employment.
B. on the horizontal part of the aggregate supply curve.
C. operating with high unemployment.
D. operating with substantial excess capacity.
Answer: A
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In economics, the concept that individuals are motivated by self-interest and respond predictably to opportunities is known as
A. altruism. B. rational behavior. C. normative bias. D. empiricism.
If something is to serve as money it must be a store of value. This means that it must
A. be divisible. B. be liquid. C. be the standard by which all goods are compared in setting prices. D. hold its purchasing power over time.
A large open economy increases its desired saving. This causes the world real interest rate to ________ and the country's current account balance to ________
A) fall; fall B) remain unchanged; rise C) fall; rise D) remain unchanged; fall
Which of the following statements accurately describes the current account in 2017?
a. The balance on goods and services was $-808 billion.
b. The current account balance was -$449 billion.
c. The balance of trade was $354 billion.
d. The net balance was -$449 billion.