According to the classical model, an increase in aggregate demand would
A. raise real Gross Domestic Product (GDP) but leave the price level unchanged.
B. lead the economy to recession.
C. lead the economy to a deflationary cycle.
D. cause an adjustment to a higher price level.
Answer: D
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Refer to Scenario 1-3. Using marginal analysis terminology, what is another economic term for the incremental cost of producing the last 400 t-shirts?
A) operating cost B) explicit cost C) marginal cost D) Any of the above terms are correct.
What is a better pricing strategy for the monopolist? At this price, what are the total profits to the monopolist?
a. Bundle the goods at $2,800 . Profits=$5,600 b. Bundle the goods at $4,000 . Profits=$8,000 c. Charge $2,800 for good 1 and charge $1,700 for good 2; Profits=$4,500 d. Charging the lowest price for each good individually is the best pricing strategy; profits = $7,000
Monopolistic competitors in long-run equilibrium will generally find that they are earning economic profits
a. True b. False Indicate whether the statement is true or false
"Logrolling" is
A) the exchange of votes to gain support for legislation. B) pressure that special interest groups place on politicians. C) when politicians refuse to go into detail and speak only in generalities. D) the process by which government agencies make sure they spend their allotted annual budget.