The aggregate demand-aggregate supply model shows that closing an expansionary gap involves deflation and closing a recessionary gap involves inflation.
a. true
b. false
b. false
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Assume there is a reduction in the shipments of petroleum products due to political tension in the Persian Gulf. In a market economy, which consumers would get the reduced supplies of gas?
A) The consumers who value gasoline the most and are able to pay for it. B) Wealthy consumers. C) Lower income consumers. D) Who gets the gasoline would be a random process. Those who arrive at the service station first will get the gasoline, regardless what its price is.
Keynes was especially interested in explaining movements of ________ because he wanted to explain why the Great Depression had occurred and how government policy could be used to increase ________ in a similar economic situation
A) aggregate output; wages B) aggregate output; employment C) wage rates; wages D) wage rates; employment
Which of the following would cause a rightward shift of the demand for loanable funds curve?
a. a fall in the marginal rate of return on investment b. a fall in the value of the marginal product of capital c. a rise in the marginal product of capital d. a fall in the investment demand curve e. a fall in the price of the product capital produces
At a price for which quantity demanded exceeds quantity supplied, a __________ is experienced, which pushes the price __________ toward its equilibrium value
A) surplus; downward B) surplus; upward C) shortage; downward D) shortage; upward