The employee is thinking like an entrepreneur in which of the following situations?
What will be an ideal response?
A staff member brings a plan to the supervisor which describes how to reduce costs and attract new customers.
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Real GDP definitely increases if
A) the AS curve shifts leftward and the AD curve does not shift. B) the AD curve shifts leftward and the AS curve shifts rightward. C) both the AD curve and the AS curve shift rightward. D) both the AD curve and AS curve shift leftward. E) potential GDP decreases so that real GDP exceeds potential GDP.
Changes in relative prices usually lead to increases in real income because prices have changed
a. True b. False Indicate whether the statement is true or false
If the exchange rate between the U.S. dollar and the Mexican peso went from $1 US = 9 peso to $1 US = 10 peso, then
a. American goods have become less expensive for Mexicans. b. Mexican goods have become more expensive for Americans. c. American goods have become more expensive for Mexicans. d. American exports to Mexico are likely to increase.
Suppose stock prices rise. To offset the resulting change in output the Federal Reserve could
a. increase the money supply. This increase would also move the price level closer to its value before the rise in stock prices. b. increase the money supply. However, this increase would move the price level farther from its value before the rise in stock prices. c. decrease the money supply. This decrease would also move the price level closer to its value before the rise in stock prices. d. decrease the money supply. However, this decrease would move the price level farther from its value before the rise in stock prices.