In the new classical model, workers and firms try to keep their real wages and relative prices from falling when ________
A) income falls
B) they expect inflation to rise
C) they expect inflation to fall
D) they expect aggregate demand to fall
B
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When the aggregate supply curve shifts adversely, what happens to the relationship shown in the Phillips curve?
a. It is reinforced, and made more applicable for policy. b. It is destroyed, and no longer applies for policy. c. It is unchanged, although the curve becomes less steep. d. It is unchanged, although the curve shifts inward and to the left.
If Abercrombie & Fitch borrows $8 million from a bank to finance the construction of a new store, this is an example of
A) a stock market transaction. B) direct finance. C) a bond market transaction. D) indirect finance.
Production Possibility Frontier (PPF)
What will be an ideal response?
After a price floor of $23 is placed on the market in the graph shown, which area represents producer surplus?
A. B + C + D + F B. B + C + D C. B + E D. B + C + E + F