For a given level of inflation, if concerns about future weakness in the economy cause businesses to reduce their spending on new capital, then the ________ shifts ________.

A. short-run aggregate supply line; upward
B. aggregate demand curve; left
C. short-run aggregate supply line; downward
D. aggregate demand curve; right


Answer: B

Economics

You might also like to view...

Use the following graph for a private closed economy (an economy with only a private sector and no international trade) to answer the next question. The equilibrium level of real GDP in this economy is

A. $250 billion. B. $350 billion. C. $450 billion. D. $150 billion.

Economics

According to OSHA standards, the air in the building that John works in is unsafe. The type of regulation that OSHA engages in is known as

A) the Federal Register. B) social regulation. C) the market share test. D) economic regulation.

Economics

Which of the following would most likely discourage investment?

a) an increase in the selling price of a firm’s output b) a reduction in the selling price of corporate stock c) an increase in bond prices d) a reduction in the rate of inflation e) an increase in the optimal capital stock

Economics

Some economists argue that there is no such thing as a short-run Phillips curve. Who are these economists and what is their argument?

What will be an ideal response?

Economics