When there is an increase in aggregate demand in the long run, there will be an increase in the price level but not in the level of output or employment.
Answer the following statement true (T) or false (F)
True
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If a Cournot duopolist announced that it will double its output,
A) it becomes the leader. B) the other firm does not view the announcement as credible. C) the other firm will shut down. D) the other firm will double output also.
In the classical model, an increasing demand for labor will
a. cause an expansion with higher employment and a higher real wage. b. cause a shortage of labor because the labor market always clears. c. cause a recession with lower employment and a lower real wage. d. cause a recession because wages are fixed in the short run. e. cause an expansion with lower employment and a higher real wage.
Which of the following is true of the inflation experienced by the Latin American countries during the 1980s and early 1990s? a. In 1990, annual inflation in Brazil and Argentina was below 10 percent
b. In the late 1980s, Brazil and Argentina experienced a steady inflation of 4 percent. c. In the late 1980s, Brazil and Argentina experienced deflation. d. In 1990, annual inflation in Brazil and Argentina climbed to over 2000 percent.
In the United States in 2015, purchases of capital equipment, inventories, and structures represented approximately
a. 3 percent of GDP. b. 7 percent of GDP. c. 15 percent of GDP. d. 17 percent of GDP.