On the long-run aggregate supply curve,
A) an increase in the price level increases the level of potential GDP.
B) an increase in the price level has no effect on the aggregate quantity of GDP supplied.
C) an increase in the price level reduces the aggregate quantity of GDP supplied.
D) an increase in the price level increases the aggregate quantity of GDP supplied.
B
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To fight unemployment and close a recessionary gap, the Fed ______
A. stimulates aggregate demand by lowering the federal funds rate, which increases the quantity of money B. stimulates aggregate supply by lowering the federal funds rate, which increases potential GDP C. increase employment, which increases real GDP D. increases bank reserves, which banks use to make new loans to busi-nesses, which increases aggregate supply
Suppose the probability of an employee being caught shirking, q, is a function of the employer's monitoring, M, such that q = M/100
If workers must put up a $1,000 bond and the gain to each worker from shirking is $100, what is the employer's optimal level of monitoring that is just sufficient to discourage shirking?
When externalities are present, reaching an efficient outcome is especially difficult when the number of interested parties is large
a. True b. False Indicate whether the statement is true or false
The problem of determining how goods and services should be produced is a problem of deciding:
A) the best combinations of resources to be used for producing goods and services. B) the extent to which imports should be reduced relative to exports. C) the extent to which exports should be reduced relative to imports. D) who owns the resources.