Assume a central bank follows a rule that requires it to take steps to keep the price level constant. If the price level fell because of a decrease in aggregate demand and an increase in aggregate supply that kept output unchanged, then
a. the central bank would have to decrease the money supply which would decrease output.
b. the central bank would have to decrease the money supply which would increase output.
c. the central bank would have to increase the money supply which would decrease output.
d. the central bank would have to increase the money supply which would increase output.
d
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Over the range of output for which the marginal product of labor curve is negatively sloped, the marginal cost curve is negatively sloped
Indicate whether the statement is true or false
If a college graduate makes $10,000 more than a high school graduate, we can safely say that the education imparted in college adds $10,000 to an individual's income
a. True b. False
The firm's demand for labor curve is exactly the same as the:
a. wage rate. b. price of the output. c. MRP curve. d. MP curve. e. labor supply curve.
The main reason why one nation trades with another is to a. save its natural resources from rapid depletion
b. exploit the advantages of specialization. c. eliminate the danger of retaliation from other nations. d. improve political alliances.