For those who favor an active approach, public policy changes are necessary to cure a recessionary gap because:
a. the short-run aggregate supply curve will otherwise shift quickly to the right
b. prices and wages are flexible downward but not upward.
c. the required decrease in output can be achieved only by shifting the aggregate demand curve.
d. real wages must fall in order to increase aggregate supply in the economy.
e. falling money wages will cause the AD curve to shift leftward unless policy counters this movement.
d
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An increase in wage rate, other things constant, shifts the aggregate supply curve downward
a. True b. False Indicate whether the statement is true or false
The primary difference between monopolistic competition and perfect competition is the number of firms in the market
Indicate whether the statement is true or false
A political leader suggesting that the country "stay the course" in the face of an economic downturn because things will be potentially made worse if tax and spending policies are adopted, is, by implication, suggesting ________ is better.
A. Discretionary Fiscal Policy B. Trade policy C. Regulatory changes D. Nondiscretionary Fiscal Policy
The restaurant industry is an example of a(n) ________ industry.
A. perfectly competitive B. oligopolistic C. monopolistically competitive D. monopolistic