Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward
B. Short-run aggregate supply shifting upward
C. Short-run aggregate supply shifting downward
D. Aggregate demand shifting leftward
Answer: B
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A spontaneous order emerges from individual decisions that cause something to "work" without anyone planning for it to "work".
Answer the following statement true (T) or false (F)
Examples from the United States suggest that the cost to consumers per job saved in highly protected industries is low
Indicate whether the statement is true or false
Which of the following is a good example of efficient specialization and voluntary exchange?
a. A college professor hires someone to rototill a garden for spring planting. b. A college professor works on the engine of a car for a neighbor who is a mechanic. c. A lawyer decides to babysit his young child and agrees to do so for others for cash. d. A physician agrees to help a neighbor work on her income tax return in exchange for her bookkeeping services.
Contractionary fiscal policy would be most effective in decreasing inflation when
a. the marginal propensity to consume low. b. investment spending is insensitive to interest rates. c. the economy has a high marginal tax rate. d. investment spending is sensitive to interest rates.