What sequence of events results from a decrease in aggregate demand?
A. The price level rises, inventories increase, firms respond by increasing output and employment.
B. The price level falls, inventories increase, firms respond by reducing output and employment.
C. The price level falls, inventories decline, firms respond by increasing output and employment.
D. The price level rises, inventories decline, firms respond by increasing output and employment.
Answer: B
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It is likely that the owners have little to do with the day-to-day management of a firm in the case of
A) partnerships only. B) proprietorships only. C) corporations only. D) partnerships and corporations.
President Jackson's reasons for vetoing the recharter of the Second Bank of the United States did not include
a. fears that the bank was nearing insolvency. b. questions of constitutionality. c. concerns over foreign ownership. d. fears that the bank could undo democracy itself.
The market produces too few public goods because:
A.) The link between payment and consumption is broken. B.) They must be paid for by wealthy individuals. C.) Only the government can produce public goods. D.) The market distributes goods to those with the most money.
The World View article "Russia's Sable Monopoly Persists" provides evidence that
A. Output of sable is lower than it would be in a competitive market. B. There are no barriers to entry in the sable market. C. Long-run economic profit is zero. D. Prices are lower than they would be in a competitive sable market.