If the value of the domestic currency depreciates:
a. Aggregate demand falls and aggregate supply rises.
b. Aggregate demand rises and aggregate supply rises.
c. Aggregate demand rises and aggregate supply falls.
d. Neither aggregate demand nor aggregate supply change.
e. None of the above.
.C
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Why is the paradox of thrift considered to be a paradox? Because an increase in saving causes
a. consumption to fall, causing the equilibrium level of national income to fall, thus leaving saving unchanged or even lower b. consumption to also rise, causing the equilibrium level of national income to rise, resulting in higher than anticipated saving c. investment to also rise, causing the equilibrium level of national income to rise,resulting in higher than anticipated saving d. investment to fall, causing the equilibrium level of national income to fall, thus leaving saving unchanged e. consumption to fall, causing the equilibrium level of national income to rise, resulting in higher than anticipated saving
Based on the figure below. Starting from long-run equilibrium at point C, a decrease in government spending that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at__ creating _____gap.
A. B; no output B. D; an expansionary C. B; recessionary D. D; a recessionary
Jake is a corn farmer in Nebraska. He rents his land on a long-term lease for $250,000 a year. He pays his farm hands $28,000 a year
Is his rent a fixed cost or a variable cost? Are the wages he pays his workers a fixed cost or a variable cost? Briefly explain your answers.
When are black markets likely to arise?
A) when the government removes a price floor B) when the government enforces a price ceiling C) when there is a surplus of a good D) when the quantity supplied of a good exceeds the quantity demanded