Which of the following is NOT a reason why real GDP can be expanded beyond a level consistent with its long-run growth path in modern Keynesian analysis?
A) Higher prices induce firms to hire more workers.
B) The existing capital stock can be used more intensively.
C) Prices and wages are flexible, allowing for needed adjustments.
D) In the short run, existing workers can work more hours.
C
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The price elasticity of supply is calculated as the
A) percentage change in quantity supplied multiplied by the percentage change in price. B) percentage change in quantity supplied divided by the percentage change in price. C) percentage change in price divided by the percentage change in quantity supplied. D) percentage change in quantity supplied plus the percentage change in price.
Net exports is negative if
A) the value of exports exceeds the value of imports. B) the value of imports exceeds the value of exports. C) the tariff payments are included in the value of imported and exported items. D) too much production occurs in the exporting country during the year.
The supply curve of a public good shows
A) the marginal cost of producing each unit of the good. B) the total quantities that all producers are willing and able to supply at each price. C) the maximum amount suppliers require to produce each quantity of the good. D) the total cost of producing each unit of the good.
Explain how product liability laws can reduce adverse selection
What will be an ideal response?