Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the long run would be:
A. P1 and Y2.
B. P2 and Y1.
C. P3 and Y1.
D. P3 and Y2.
Answer: D
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The price of pizza falls by 25 percent. If the elasticity of demand for pizza is equal to –1.5, what will happen to the quantity of pizza demanded?
What will be an ideal response?
If all actions are known to all then there is
A) a focused economy. B) a negative externality. C) transparency. D) a dictatorship.
In the short-run macro model, a decrease in the money supply will
a. lower the interest rate, increase spending, and increase GDP b. lower the interest rate, reduce spending, and lower GDP c. raise the interest rate, increase spending, and increase GDP d. raise the interest rate, reduce spending, and lower GDP e. raise the interest rate, reduce spending, and increase GDP
Increases in the supply of scientists and engineers can increase the level of
a. investment. b. consumption. c. government spending. d. technology.