?In the long run, a decrease in aggregate demand causes the price level to _______ and the long-run aggregate supply curve to _____________.
A. ?decrease; decrease
B. ?increase; increase
C. ?decrease; remain unchanged
D. ?increase; remain unchanged
Answer: C
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According to real business cycle theory, business cycles
a. can be eliminated with appropriate monetary and fiscal policy. b. are natural and efficient reactions to changes in productivity. c. do not occur. d. occur infrequently. e. none of the above.
The use of countercyclical monetary and fiscal policy by the government and the Fed to steady the economy is known as
a. discretionary policy b. monetarist policy c. creative policy d. stabilization policy e. institutional policy
A good will have a more elastic demand, the
a. greater the availability of close substitutes. b. more broad the definition of the market. c. shorter the period of time. d. more it is regarded as a necessity.
Suppose you purchased 100 shares of stock in 2016 for $25 a share and you sell them today for $30 a share. If the capital gains tax is 30 percent, your tax liability is
A. $70. B. $150. C. $500. D. indeterminate without knowing the inflation rate.