In the aggregate demand–aggregate supply model, a decrease in income taxes can be illustrated by an
A. outward shift of the aggregate demand curve.
B. inward shift of the aggregate demand curve.
C. inward shift of the aggregate supply curve.
D. outward shift of the aggregate supply curve.
Answer: A
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Which of the following statements about private and social costs is TRUE?
A) Social costs include externalities. B) Private cost do not include externalities. C) Social costs are never smaller than private costs. D) All of the above.
The government should not attempt to balance the budget if
a. the economy is in a recessionary gap. b. actual GDP is below full-employment GDP. c. unemployment is rising. d. All of the above are correct.
The concept of present value helps explain why the quantity of loanable funds demanded decreases when the interest rate increases
a. True b. False Indicate whether the statement is true or false
What does the Phillips curve illustrate, and what changes in the AS-AD model support this relationship?
What will be an ideal response?