The equation of exchange suggests that if the velocity of money and the quantity of goods and services are held constant, a(n):
A. Decrease in the money supply will increase the price level
B. Increase in the money supply will decrease the price level
C. Increase in the money supply will increase the price level
D. Decrease in the money supply will have no effect on the price level
C. Increase in the money supply will increase the price level
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The government would want the economy to contract when real GDP is
A. Above potential GDP and the price level is falling B. Below potential GDP in the price level is falling C. Above potential GDP and the price level is rising
If the marginal cost curve is below the average total cost curve, average total cost must be ____.
Fill in the blank(s) with the appropriate word(s).
Answer the following questions true (T) or false (F)
1. A positive technological change will cause the quantity of a good supplied to increase. 2. An increase in quantity supplied is represented by a rightward shift of the supply curve. 3. A decrease in the price of inputs will cause the supply curve for a product to shift to the right.
Excess quantity demanded may result from
A. a government-imposed maximum price below market equilibrium. B. a government-imposed minimum price above market equilibrium. C. an oversupply of output. D. technological progress.