Figure 14-1
In , an unanticipated shift to a more expansionary monetary policy will shift
a.
AD to the right and temporarily increase real GDP.
b.
AD to the left and temporarily reduce real GDP.
c.
AD to the right and SRAS to the left and lead to higher prices (inflation).
d.
both AD and SRAS to the right and lead to an increase in real GDP.
a
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Elasticity of demand equals the ratio of the percentage change in the quantity demanded to the percentage change in the price of the good.
Answer the following statement true (T) or false (F)
If workers and firms expect increases in future prices, it can lead the short run aggregate supply curve to shift left
a. True b. False Indicate whether the statement is true or false
Equilibrium GDP on the demand side occurs when total spending
a. equals total production, and inventories are zero. b. equals total production, and firms are unable to adjust inventories. c. exceeds total production, and inventories are rising. d. equals total production, and inventories remain at desired levels. e. is less than total production, and inventories are falling.
Tie-in-sales require that a customer who buys one product (the tying good) must also ______.
a. pay switching costs to change from one brand (the tied brand) to another brand b. buy a greater quantity of the tying good because many other consumers are buying it c. buy another product (the tied good) that the customer needs to use the first product d. pay more for it than would be charged by a competitor selling the same tying good