In the long run, a decrease in aggregate demand causes the price level to _______ and the long-run aggregate supply curve to _____________
a. decrease; decrease
b. increase; increase
c. decrease; remain unchanged
d. increase; remain unchanged
c
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In the coordination failure model, the most likely explanation of business cycles are
A) money supply shocks. B) government spending shocks. C) total factor productivity shocks. D) fluctuations between "good" and "bad" equilibria.
Each person in the population can be classified as employed or unemployed
a. True b. False Indicate whether the statement is true or false
One way to avoid the principal-agent problem would be to have:
A. the employer constantly monitor the employee's efforts. B. the employee sign a waiver of release. C. the employer share all management choices with employees before making decisions. D. the employee constantly monitor the employer's activities.
If a Central Bank wished to increase the supply of money it should
(a) Raise the reserve requirement. (b) Raise the rate of discount. (c) Buy government bonds in the money market. (d) Do any or all of the above.